The announcement that the average rate on a 30-year fixed-rate mortgage (FRM) fell from the recent high last week of 5.05 percent to 5 percent this week was welcome news for potential home buyers who have been on the sidelines recently.

Last week’s average rate on a 30-year FRM was the highest since April 2010 (Primary Mortgage Market Survey released Thursday by Freddie Mac), and dipped this week based mainly on the weakening of the 10-year Treasury yield which it tends to follow.

The vice president and chief economist at Freddie Mac, Frank Nothaft, indicated that, until 2009, the rate of a 30-year FRM had not been as low as 5 percent once in the years since 1971 when Freddie Mac started their survey.

Weakening also, the rate on a 15-year FRM dropped on average .02 percent to 4.27 percent from last week’s 4.29 percent. Also, the rate on the five-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) dropped on average .05 percent to 3.87 percent from last week’s 3.92 percent. Interestingly, the rate on the one-year Treasury ARM increased on average .04 percent to 3.39 percent from last week’s 3.35 percent.

The White House published its intended $3.7 trillion budget this week. Although there were fears of higher inflation last week which saw a rise in these rates, the budget request appeared to be instrumental in bringing them down again this week.

The average rate on a 30-year FRM bottomed out at 4.17 percent in November; the lowest in 40 years. The average rate on a 15-year FRM dipped to a low of 3.57 percent that month; the lowest since 1991.