Mortgage rates declined last week to their lowest level in 2017, a move that could help fuel buyer demand at a time when the supply of homes already is under strain.

The rate for a 30-year mortgage fell to 3.88% in the week ended Thursday, down from a week earlier when it averaged 3.9%. That was well above a year ago, when it averaged 3.48%.

Economists had widely predicted mortgage rates to rise to around 4.5% by the end of this year. That looks increasingly unlikely. Dimming prospects for the Republican legislative agenda, especially tax reform, have helped keep a ceiling on rates.