• On Friday, the average rate on the 30-year fixed mortgage hit 3.23%, down from 3.42% at the beginning of the week, according to Mortgage News Daily.
  • That’s the lowest rate since September 2012. Mortgage rates have been pushed lower by falling US Treasury yields as investors flee to quality amid coronavirus panic.
  • It’s possible that mortgage rates could fall even further, according to Matt Graham, chief operating officer of Mortgage News Daily.
  • Read more on Business Insider.

Coronavirus fears have pushed mortgage rates lower in just one week.

On Friday, the average rate on the 30-year fixed mortgage hit 3.23%, down from 3.34% at the beginning of the week, according to Mortgage News Daily. It’s now the lowest rate seen since the 30-year briefly touched 3.15% in September 2012.

Mortgage rates take their cues from US Treasury yields, which have fallen to fresh record lows as fears that coronavirus will stall global growth push investors into safe-haven assets. On Friday, the yield on the benchmark 10-year US Treasury fell to an all-time low of 1.15%. The same day, the 30-year US Treasury bond also slipped to a historic low of 1.67%. Bond yields fall as prices rise.

It’s possible that mortgage rates could fall even further, according to Matt Graham, chief operating officer of Mortgage News Daily.

If 10-year yields flatten out or continue to move lower, mortgage rates will eventually follow, albeit "slowly and timidly," Graham told Markets Insider in an email. On the flip side, if the 10-year yield rebounds and moves higher, mortgage rates won't move up nearly as quickly, he said.

So far, the low rates have been adding fuel to the already-hot housing market. Refinancing applications could also continue to tick up if eligible homeowners see the new low rates as an opportunity to lower monthly payments. For the week ending February 21 - before coronavirus fears hit global markets - refinancing rates were 152% higher than the same week one year ago, according to the Mortgage Bankers Association.

"Last week appears to have been the calm before the storm," said Mike Fratantoni, the senior vice president and chief economist of the Mortgage Bankers Association, in a press release. Next week's results will show the impact the drop in Treasury yields had on mortgage activity, he added.