The Mortgage Bankers Association reported that mortgage rates turned lower for the second week in a row, but it wasn't enough to boost demand for either new purchase loans or refinances.
Rates have been higher for the past two years. The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances decreased to 5.46 from 5.49%, with points decreasing to 0.60 from 0.74 for loans with a 20% down payment.
The number of applications to refi a home loan dropped 2% for the week and were 75% lower than a year ago.
Refi applications have fallen in nine of the past 10 weeks as most borrowers remain on the sidelines. According to the associate vice president of economic and industry forecasting, refinance activity is down by over 70%.
Homebuyers are pulling back as well. The number of applications for a mortgage to purchase a home was down from a year ago.
There is more supply on the market, but homes are sitting longer for sale.
At the start of the Covid epidemic in spring 2020, mortgage demand was close to the lows last seen. frenzied demand pushed prices higher over the past two years.
People looking to purchase their first home are being deterred by high prices.
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