Florida Mortgage Rates Fall; Lowest Since October

Long-term mortgage rates fell again this week, with standard 30-year, fixed-rate mortgages reaching their lowest level since late October.

The weekly report issued by Freddie Mac puts the average loan at 6.10 percent, down from 6.15 percent last week and 6.21 the week before. One year ago, fixed-rate 30-year mortgages were averaging 5.67 percent. Also driven by signs of easing inflation, the average rate on 15-year fixed-rate mortgages fell to 5.67 percent from last week’s average of 5.71 percent. The 15-year loans averaged 5.15 percent at this time last season.

“Over the last six weeks, long-term mortgage rates have dropped nearly a quarter of a percent in the face of little or no inflationary pressures. Our outlook for the housing industry continues to be that mortgage rates will remain affordable for the rest of the year at least, keeping the industry alive and well into the foreseeable future,” said Freddie Mac chief economist Frank Nothaft.

Short-term rates rose this week, however, with the average one-year adjustable-rate mortgage at 5.18 percent, up from 5.15 percent last week. A year ago, a one-year ARM was averaging just 4.11 percent. A separate report Thursday from the U.S. Commerce Department shows housing starts fell to a nine-month low in December, down 8.9 percent from November. This is another sign that the market may be headed for a cooldown.

The overall Florida real estate market looks strong, however. Rates are projected to remain affordable, albeit above last year’s record lows, throughout 2006. Demand for commercial and agricultural real estate in Florida has never been higher, and is not expected to lessen any time soon. For potential first-time residential buyers, this is a good time to consider taking out low-interest Florida home loans, with sales falling off record pace but rates still low.