The average rates of US mortgage slumped for the fourth straight week after the 30-year loan hit its lowest level since June last year, making it more affordable for the buyers to borrow for purchasing a home.
Meanwhile, the treasury bond yields marked new lows amid the rising concern over global economic woes.
Mortgage firm Freddie Mac on Thursday said that the average for a 30-year loan nationwide tumbled to 3.97 percent from previously recorded 4.12 percent last week.
The average rate for a 15-year mortgage, which is one of the most opted methods for people who are looking for refinancing, dipped to 3.18 percent from 3.30 percent.
Notably, the rates of mortgage usually follow the 10-year Treasury note yield. On Wednesday, the 10-year note traded at 2.13 percent, which was down from 2.34 percent in the previous week. It traded at 2.11 percent on Thursday morning.
Notably, the bond yields increase when bond prices decline.
Treasury yields have declined sharply on expectations that the sluggish economic condition could push the Federal Reserve to delay possible interest rate hikes.
Financial analysts say the growing concerns over the sluggish world economic growth rate could further slowdown the US economy, while hurting the corporate profits.
Meanwhile, the investors at the Wall Street also fled stocks and poured money into bonds. The Dow Jones industrial average ddipped 460 points in the afternoon trading, while the other three US stock indexes were recorded in the negative territory for the year.
Meanwhile, the analysts said that even if the mortgage rates have declined, the Fed is likely to end its monthly bond purchases at the end of this month. Moreover, the Fed is intended to keep long-term borrowing rates low.