After a steady climb for almost two months, average rates on fixed rate home loans made their first significant drop. The average on a 30-year fixed rate loan dropped to 4.77 percent, excluding points, during the week ended Thursday, January 6, down from 4.86 percent the previous week. It is still lower than a year ago though, when the rate average 5.09 percent.

Rates made slightly less movement on 15-year fixed mortgages, falling to 4.13 percent from 4.20 percent. One-year adjustable rate mortgages saw hardly any change, fluctuating to 3.24 percent down from 3.26 percent.

The 30-year fixed rate mortgage hit its lowest point ever during the week of November 11, 2010, when the rate bottomed out at 4.17 percent. Since then rates have been risen consistently, in response to moving bond yields, as more and more investors transferred their money into stocks.

“I wouldn’t be surprised to see mortgage rates stay at these levels for the next few months,” said Paul Dales, U.S. economist for Capital Economics Ltd. in Toronto as quoted in a Washington Post article . “The main driver of what’s happened is the 10-year Treasury, which has leveled off a bit.”

However, this one week of rate dips may not be much to sneeze at, says Leonard Baron, a real-estate professor at San Diego University in a SD Union-Tribune piece.

“The market is functioning properly,” Baron said. “Such a small amount is just irrelevant.”

The more important factor, he believes, is that rates have been moving up generally, a sign of increased consumer confidence.

Another sign of consumer confidence this week: An increase in the Mortgage Bankers Association application index, which picked up from a 12-month low. Refinance loan application grew by 3.9 percent last week, although purchase applications slid by 0.8 percent.