- Demand for refinancing rose 18% each week but was still 75% lower than the same week a year ago.
- Mortgage applications to buy a home rose 3% in a week and were 37% lower than in the same week a year ago.
- The average loan size in a purchase application increased to $428,500, the largest average since May 2022.
Mortgage rates continued to fall last week, and both current homeowners and potential homebuyers have reacted quickly.
Total mortgage applications, including refinancing and home loans, jumped 7.4% last week from the previous week, according to the Mortgage Bankers Association’s seasonally adjusted index.
The average contractual interest rate for 30-year fixed-rate mortgages with a qualifying loan balance ($726,200 or less) fell to 6.18% from 6.19%, with pips falling to 0.64 from 0. 65 (including issuance fee) for loans with 20% down. payment. This figure was 3.83% in the same week a year ago.
With rates at their lowest level since early September, demand for refinancing rose 18% each week but was still 75% lower than the same week a year ago. The share of refinancing mortgage activity increased to 33.9% of the total number of applications from 31.2% the previous week.
Mortgage applications to buy a home rose 3% in a week and were 37% lower than in the same week a year ago.
“Buying activity, which was put on hold last year due to rapid rate increases, is slowly picking up as rates come down and housing demand remains strong, thanks to favorable demographics and the continued growth of the job market,” said Joel Kahn. . MBA economist.
Kan added that the average loan size in a purchase application increased to $428,500, the biggest average since May 2022.
“This increase is a sign that the recent uptrend in buying activity is still skewed towards higher credit and lower first-time homebuyer activity as entry-level home supply remains tight and homebuyers struggle with affordability in many markets,” said Kan.
Mortgage rates rebounded sharply earlier this week after an unexpectedly strong employment report on Friday and comments on Tuesday from Federal Reserve Chairman Jerome Powell that the central bank may continue to raise interest rates.
“The reality is that we are going to be reacting to the data,” Powell said. “So if we continue to get, for example, strong labor market reports or reports of higher inflation, it could very well be that we have to do more and raise rates more than what is priced in.”
The average rate on 30-year fixed bonds jumped nearly half a percentage point from Thursday to Tuesday, according to a separate survey by Mortgage News Daily.
Credit: www.cnbc.com /