Mortgage applications have surged as a result
of ConsumerAffairs
People hoping to buy a home have something to be thankful for. Freddie Mac says its Primary Mortgage Market Survey shows the 30-year fixed-rate mortgage (FRM) averaged 6.81% this week. This weeks results include an adjustment for the observance of Thanksgiving.
The 30-year fixed-rate mortgage moved down this week, but not by much, said Sam Khater, Freddie Macs chief economist.
Rates have been relatively flat over the last few weeks as the market waits for more clarity on specific economic policies. Potential homebuyers are also waiting on the sidelines, causing demand to be lackluster. Despite the low sales activity, inventory has only modestly improved and remains dramatically undersupplied.
That lack of demand experienced a reversal last week, according to the Mortgage Bankers Association. MBA said a slight decline in mortgage rates last week brought many buyers back to the market.
The Market Composite Index, a measure of mortgage loan application volume, increased 6.3% on a seasonally adjusted basis from one week earlier. But the Refinance Index decreased 3% from the previous week and was 119% higher than the same week one year ago.
Lower rates are drawing more buyers
Purchase activity drove overall applications higher last week, as conventional purchase applications picked up pace and mortgage rates declined for the first time in over two months, with the 30-year fixed rate dropping slightly to 6.86 percent, said Joel Kan, MBAs deputy chief economist.
With the growth in for-sale inventory and signs that the economy remains strong, Kan says buyers have remained in the market even though rates have increased recently. But affordability remains challenging as the average purchase loan size to $439,200, its highest level in almost a month.
New home prices tend to be higher than existing home prices and builders are finding fewer buyers with mortgage rates at these levels. The U.S. Census Bureau reports sales of new single-family homes fell in October to the lowest level in about two years a decline attributed to mortgage rates and hurricanes.
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Posted: 2024-11-27 17:56:11
