This aerial photo shows homes near the Chesapeake Bay in Centreville, Maryland, on March 4, 2024.
Jim Watson | AFP | Getty Images
Overall mortgage demand has now moved sideways for three straight weeks, but last week saw a split between those looking to buy a home and those hoping to save money by refinancing.
Total mortgage application volume rose just 0.1% last week from the previous week, according to the seasonally adjusted Mortgage Bankers Association index, and is essentially flat.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($766,550 or less) rose to 7.01% from 6.91%, with points remaining at 0.59 (including origination fee) for loans with a 20% down payment. %.
“Mortgage interest rates rose last week as several Fed officials reiterated their patient stance on rate cuts. Inflation remains stubbornly above the Fed's target, and the broader economy continues to show resilience. Unexpectedly strong employment data released this week added to the The past of upward pressure. “On rates,” said Joel Kahn, MBA vice president and deputy chief economist.
Home loan refinancing applications jumped 10% during the week and were 4% higher than the same week a year ago. Demand for refinancing typically declines when interest rates rise, but rates have fallen slightly in previous weeks, so some homeowners may have been waiting for interest rates to fall. When interest rates rose last week, they may have been worried that interest rates would rise next, so they jumped in to grab what savings they could.
Home mortgage applications fell 5% during the week and were 23% lower than the same week a year ago. The spring market is well underway, and although there is a little more inventory now than there was a year ago, it is still well below where it should be in high demand. Home prices also show no sign of slowing down.
Investors are awaiting the important monthly report on consumer prices, an indicator of inflation. It is scheduled to be released Wednesday morning, and depending on the outcome, mortgage rates could move strongly in either direction.
