Weekly mortgage demand stalls again with just miniscule increase in interest rates

CNBC

6 hours ago

After a significant surge in refinance demand the previous week, brought on by a drop in mortgage rates, both refinance and homebuyer mortgage application volume stalled last week. Mortgage rates inched only very slightly higher, but it was enough to drop total application volume 1.4% compared with the previous week, according to the Mortgage Bankers Association's seasonally adjusted index.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances, $806,500 or less, increased to 6.68% from 6.67%, with points decreasing to 0.60 from 0.64, including the origination fee, for loans with a 20% down payment.
Applications to refinance a home loan fell 3% for the week but were 23% higher than the same week one year ago. This, despite the fact that rates today are actually higher than they were at this time last year. The previous week, refinance demand had surged 23% higher just week-to-week. With so few borrowers able to benefit from a refinance at today's higher rates, this figure has become increasingly volatile.
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Applications for a mortgage to purchase a home rose 0.1% for the week and were also 23% higher than the same week one year ago.
"Purchase applications were little changed over the week but were at the strongest pace in four weeks and continued to run well ahead of last year's pace," said Joel Kan, an MBA economist in a release. "Prospective homebuyers remain more active compared to last year despite economic headwinds and uncertainty and affordability challenges."
Mortgage rates have done nothing so far this week, barely moving at all.
"Bonds (and, thus, rates) are still operating in the range seen in the 24 hours following the August 1st jobs report. Mortgage rates have been in an even narrower range than the broader bond market," wrote Matthew Graham, chief operating officer at Mortgage News Daily.