Decline in fixed mortgage rates continues unabated through the holidays

This holiday season has brought good news for anyone looking to buy a house or refinance a mortgage.

According to the latest data released Thursday by Freddie Mac, the 30-year fixed-rate average dipped to 4.55 percent with an average 0.5 point. (Points are fees paid to a lender equal to 1 percent of the loan amount.) It was 4.62 percent a week ago and 3.99 percent a year ago.

The 15-year fixed-rate average slipped to 4.01 percent with an average 0.4 point. It was 4.07 percent a week ago and 3.44 percent a year ago. The five-year adjustable rate average ticked up to 4 percent with an average 0.3 point. It was 3.98 percent a week ago and 3.47 percent a year ago.

"Rates continued their two-month slide and are currently hovering around the same level as the early summer, which was before the deterioration in home sales," Sam Khater, Freddie Mac chief economist, said in a statement. "The negative headlines around the financial markets are concerning but the economy remains healthy, so the drop in mortgage rates should stem or even reverse the slide in home sales that occurred during the second half of 2018."

Since peaking at 4.94 percent in early November, its highest level in seven years, the 30-year fixed-rate average has trended downward even as the Federal Reserve has continued to hike short-term interest rates. The central bank doesn't set mortgage rates, but its actions influence them.

The financial markets have been racked by concerns over the government shutdown, Treasury Secretary Steven Mnuchin's comments on banks, trade concerns, Brexit and slower economic growth. Although the stock market staged a big rally Wednesday, its volatility is causing investors to move their money into safer assets such as bonds.

The yield on the 10-year Treasury, which is the most closely watched indicator for where mortgage rates are headed, fell sharply Monday to 2.74 percent before rebounding Wednesday to 2.81 percent.

Not only are mortgage rates falling, but home prices are moderating. Earlier this week, the Case-Shiller home price index was released showing that price growth was flat in October when compared to the previous month.

"The housing market slowdown that began in the second half of 2018 sets up a mixed bag for homebuyers and sellers as we look at an uncertain 2019," said Aaron Terrazas, senior economist at Zillow. "Slowing home price appreciation can be read by many as an ominous sign - a kind of canary in the coal mine - for a more general downturn to come, but it's not necessarily an indicator that the sky is falling ... For the time being, this slowdown represents a return to fundamentals more than anything else, and to more balance between buyers and sellers."

The Mortgage Bankers Association did not release data on mortgage applications this week because of the holidays.