A ‘For Sale’ sign is posted in front of a single-family home on October 27, 2022 in Hollywood, Florida.
Joe Raedle | beautiful pictures
Mortgage rates continued to fall last week, and both current homeowners and potential homebuyers responded quickly.
Total mortgage application volume, which includes refinances and home loans, rose 7.4% last week from the previous week, according to the World Banks Association’s seasonally adjusted index. challenge.
The average contract rate on 30-year fixed-rate mortgages with matching loan balances ($726,200 or less) dropped to 6.18% from 6.19%, with the score dropping to zero. 64 from 0.65 (including initial fees) for loans with a 20% reduction. Payment. That rate was 3.83% the same week a year ago.
With interest rates at their lowest level since early September, refinancing demand is up 18% week-on-week but still 75% below the same period a year ago. Mortgage’s refinance rate rose to 33.9% of total applications from 31.2% last week.
Mortgage applications to buy a home increased 3% for the week and 37% lower than the same week a year ago.
“Purchasing activity that stalled last year as rapidly rising interest rates is slowly coming back as interest rates fall and housing demand remains strong, driven by a supportive demographic and,” said Joel Kan. the unrelenting strength of the job market”. an MBA economist.
Kan added that the average loan size per purchase application rose to $428,500 — the largest average since May 2022.
“This uptick is indicative of the recent uptrend in purchasing activity that remains tilted towards larger loan sizes and less first-time homebuyer activity, as entry-level housing continues to grow,” Kan said. There is still a shortage of supply and buyers struggle with affordability in many markets.”
Mortgage rates have rebounded significantly since earlier this week, following Friday’s unexpectedly strong jobs report and Tuesday’s comments from Federal Reserve Chairman Jerome Powell that the central bank could continue continue to increase interest rates.
“The reality is we’re going to react to the data,” Powell said. “So if we continue to get, for example, a strong labor market report or a higher inflation report, then chances are we have to do more and raise rates more than we value.” .”
The average rate on the 30-year fixed bond rose nearly half a percentage point from last Thursday to Tuesday, according to a separate survey by Mortgage News Daily.
