U.S. mortgage rates nudge closer to record low

A prospective home buyer tours a condominium for sale in Medford, Massachusetts, April 2, 2009.

NEW YORK (Reuters) - U.S. mortgage rates fell in the latest week, nudging closer to a recent record low, helped by government efforts to bring rates down to levels that will spur demand and help the hard-hit housing market begin to recover.

Interest rates on U.S. 30-year fixed-rate mortgages fell to 4.80 percent for the week ending April 23, down from the previous week's 4.82 percent, according to a survey released on Thursday by home funding company Freddie Mac.

Three weeks earlier, mortgage rates were 4.78 percent, which was the lowest since Freddie Mac started surveying them in 1971.

The drop is a glimmer of hope for the U.S. housing market amid otherwise dismal data.

The National Association of Realtors on Thursday said the pace of sales of existing homes in the United States fell 3.0 percent in March to a much lower-than-expected annual rate of 4.57 million units.

"Although long-term mortgage rates eased slightly this week, ARM rates remain elevated relative to those fixed-rate mortgages," Frank Nothaft, Freddie Mac vice president and chief economist, said in a statement.

The battered U.S. housing market, which is in the midst of its worst downturn since the Great Depression, is both the source and a major casualty of the credit crisis. A recovery for the market could portend a turnaround for the United States, the world's largest economy.

(Additional Reporting by Lucia Mutikani)