(Bloomberg) -- Mortgage rates in the U.S. fell to another record low.
The average for a 30-year, fixed loan dropped to 2.78%, the lowest in data going back to 1971, Freddie Mac said Thursday. It was the 12th record low this year. The previous one, 2.8%, held for two weeks.
The decline in borrowing costs that began in March, as the coronavirus roiled financial markets, shows no signs of stopping. Cheap loans have powered a housing rally that has bolstered the pandemic economy. Purchases have soared and millions of current homeowners have been able to save money by refinancing.
Read more: Homes Are Still Selling Like It's Summer Across the U.S.
The Federal Reserve's plan to hold its benchmark rate near zero for the time being should keep a lid on mortgage rates, which have been below 3% since July. But demand for homes is far outstripping supply, sparking bidding wars in some areas. The resulting price gains are putting homeownership out of reach for many Americans.
©2020 Bloomberg L.P.
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