WASHINGTON (AP) — Average long-term U.S. mortgage rates fell this week, retreating from highs for the year and amplifying the incentive for prospective home buyers.

Mortgage giant Freddie Mac said Thursday the average rate on a 30-year fixed-rate mortgage declined to 4.04 percent from 4.09 percent a week earlier. The rate on 15-year fixed-rate mortgages slipped to 3.21 percent from 3.25 percent.

As in recent weeks, mortgage rates followed the yield on the key 10-year Treasury note, which declined. Bond yields for Treasurys were pushed lower by a rise in bond prices. The yield on the 10-year note eased to 2.33 percent Wednesday from 2.36 percent a week earlier. It held steady in trading Thursday morning at 2.33 percent.

With mortgage rates at low levels and the economic recovery in its sixth year, home-buying has recently surged as more buyers have flooded into the real estate market. Data issued Wednesday by the National Association of Realtors showed that Americans bought homes in June at the fastest rate in more than eight years, pushing prices to record highs as buyer demand has eclipsed the availability of houses on the market.

The median home price has climbed 6.5 percent over the past 12 months to $236,400, the highest level — unadjusted for inflation — reported by the Realtors.

To calculate average mortgage rates, Freddie Mac surveys lenders across the country at the beginning of each week. The average doesn't include extra fees, known as points, which most borrowers must pay to get the lowest rates. One point equals 1 percent of the loan amount.

The average fee for a 30-year mortgage was unchanged from last week at 0.6 point. The fee for a 15-year loan also held steady at 0.6 point.

The average rate on five-year adjustable-rate mortgages ticked up to 2.97 percent from 2.96 percent; the fee was unchanged at 0.5 point. The average rate on one-year ARMs rose to 2.54 percent from 2.50 percent; the fee remained at 0.3 point.