30-year mortgage rates spring back to 5.56 percent

? Rates on 30-year mortgages fell again this week, dropping to the lowest point since the spring of 2004, according to a nationwide survey.

The mortgage company Freddie Mac said Thursday its weekly survey showed that rates on 30-year, fixed-rate mortgages averaged 5.56 percent, compared with 5.62 percent last week.

The ninth decline in the past 10 weeks pushed sent rates to the lowest level since they averaged 5.52 percent the week of April 1, 2004.

The steady decline during the past two months helped sales of new and existing homes set records in April. Analysts predicted further strong sales in May.

The most recent drop in rates was attributed to the weaker-than-expected jobs report last week. It showed that businesses added just 78,000 workers to their payrolls, the poorest showing in nearly two years.

“The May employment report came in at less than half of what was expected last month, which pushed bond yields – and mortgage rates – down further,” said Frank Nothaft, chief economist at Freddie Mac.

Nothaft said the continued declines in mortgage rates had caused him to lower his forecast for where rates will be at year’s end. He said he expected 30-year mortgages to end up at between 5.9 percent and 6.2 percent, compared with his earlier prediction of 6.5 percent.

For 15-year, fixed-rate mortgages, a popular option for refinancing, rates dipped to 5.14 percent this week, compared with 5.20 percent last week.

Rates on one-year adjustable rate mortgages fell to 4.21 percent from 4.26 percent last week.

For five-year hybrid adjustable rate mortgages, rates fell to 5.01 percent from 5.10 percent last week.