(Bloomberg) — Mortgage rates in the U.S. dropped to the lowest in almost five months.
The average for a 30-year loan was 2.9%, down from 2.98% last week and the lowest since Feb. 18, Freddie Mac said in a statement on Thursday.
The slide follows a plunge in yields for the benchmark 10-year Treasury, which dropped below 1.3% on Thursday for the first time since February amid investor concerns that the spread of Covid-19 variants will slow economic growth.
Read more: Slowing Mortgage Refinancings Signal Rates May Fall
Lower borrowing costs have fueled the pandemic housing rally. Mortgage rates have been hovering close to 3% for about three months after dipping to a record low in January.
The drop in mortgage rates this week could prompt more homeowners to refinance their mortgages, according to Greg McBride, chief financial analyst at Bankrate.com.
“It’s kind of ringing the bell for those who are putting it off,” he said. “This is a prime opportunity to refinance and cut your mortgage rates in a meaningful way.”
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