Mortgage Demand Falls
Mortgage applications fell 6.9% from one week earlier, according to the latest data from the Mortgage Bankers Association’s weekly survey. (MBA)
The decline was equally divided between purchases and refis. Let’s get into the numbers…
- The Refinance Index fell 8% from the previous week and was 15% lower than the same week one year ago.
- The Purchase Index fell 6% from the previous week and was 17% lower than the same week one year ago.
Rates over 3% might be here to stay. Average mortgage rates on a 30-year fixed jumping 2 basis points to 3.20% with points decreasing to 0.39.
First-time homebuyers hardest hit. Mike Fratantoni, MBA’s Senior Vice President and Chief Economist, notes that demand actually declined to the lowest level since last May, and despite higher rates, prices continue to climb which is hurting first-time homebuyers. “The average loan size for total purchase applications increased, indicating that first-time homebuyers, who typically get smaller loans, are likely getting squeezed out of the market due to the lack of entry-level homes for sale.”