The average interest rate for a 30-year fixed-rate home loan is down to 4.12 percent, the lowest level so far this year, according to Freddie Mac's weekly mortgage rate survey.
Last week, the average interest rate was slightly higher at 4.14 percent. A year ago, it was on its way upward at 4.40 percent, eventually peaking at 4.57 percent in mid-September.
Rates also dipped for 15-year fixed-rate mortgages, which averaged 3.24 percent this week compared to 3.27 percent last week. At this time in 2013, the rate was 3.44 percent.
Interest rates have been declining all year amid stagnant wages and softer-than-expected economic reports. Frank Nothaft, Freddie Mac's vice president and chief economist, said retail sales were "virtually unchanged in July" following five months of growth.
Despite the persistent low interest rates, mortgage applications decreased 2.7 percent last week, according to the Mortgage Bankers Association's weekly mortgage applications survey. Refis made up 54 percent of total applications, down from 55 percent last week.