The refinance and mortgage markets continue to suffer from rising interest rates. According to the seasonally adjusted index of the Mortgage Bankers Association, the total volume of mortgage applications fell by 2.8% last week.
For loans with at least 20% down, the average 30-year fixed-rate interest rate on mortgages has increased from 3.16% to 3.20%.
Refinance demand dropped 5% over the past week, and it was 31% less than one year ago. In seven out of eight weeks, refinance applications dropped. From 63.5% last week, the refinance portion of mortgage applications decreased to 62.9%.
“Activity is sensitive to rates movements. Last week’s drop was caused by a decrease in FHA and conventional refinance application, which were offset by an increase in VA refinance requests. Joel Kan, MBA’s vice president for economic and industry forecasting.
The mortgage applications required to buy a house were up 2%, however they were lower by 6% than the previous week. The market is seeing buyers return after a temporary lull. Builders reported strong buyer traffic in a sentiment report out this weekThe National Association of Home Builders.
“Purchase applications increased for both conventional and government loan segments, as housing demand continues to show resiliency at a time – late fall – when home buying activity typically slows. Kan said that the second consecutive increase in buy applications indicates that sales activity will continue to grow in weeks.
To start the week, mortgage rates moved higher and now stand at their highest point in over three weeks. Tuesday’s rate changes had an impact on rates a report on October’s retail salesIt was the strongest month for many years, with a rise of 1.7%.
Rates are generally under pressure due to strong economic data. Matthew Graham (chief operating officer of Mortgage News Daily) stated that economists had only expected an increase in rates by 1.4% after the 0.8% improvement last month.