Mortgage rates at lowest level in 2 years

NEW YORK (CNNMoney.com) -- Interest rates on fixed-rate mortgages slipped again this week as the glut of available homes exerted downward pressure on prices and construction activity, Freddie Mac reported Thursday.

The government-sponsored loan buyer said the rate on a 30-year fixed-rate loan fell to an average 6.10 percent for the week ended Nov. 29, from 6.20 percent the prior week. At this time last year, the 30-year FRM averaged 6.14 percent.

The 30-year rate has not been lower since the week ending Oct. 13, 2005, when it averaged 6.03 percent, Freddie Mac said.

"Interest rates for U.S. Treasury securities have been drifting lower this month over market concerns that the housing slump and stress in the credit markets could slow future economic growth," said Freddie Mac chief economist Frank Nothaft.

With home prices falling 4.95 percent in the 12-months ending September and 15 metropolitan areas showing annual declines, "the overall picture does, indeed, appear glum with no immediate relief in sight," Nothaft said.

Freddie Mac said rates on 15-year fixed-rate loans averaged 5.73 percent, down from 5.83 percent last week. A year ago, the 15-year FRM averaged 5.87 percent. The 15-year rate has not been lower since the week ending January 26, 2006, when it averaged 5.70 percent.

Five-year adjustable-rate mortgages (ARMs) averaged 5.86 percent this week, down from 5.88 percent last week. A year ago, the five-year ARM averaged 5.95 percent.

One-year Treasury indexed ARMs averaged 5.43 percent this week, from 5.42 percent last week. At this time last year, the 1-year ARM averaged 5.46 percent.