After dropping at the end of July, mortgage rates moved higher on average again last week. According to the Mortgage Bankers Association, there was a split in mortgage demand, with gains in refinancing but decreases in applications from home buyers.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances increased to 5.41% from 5.41%, with points rising to 0.80 from 0.65 for loans with a 20% down payment. Daily moves were more dramatic than the weekly average would have you believe.
The average rate on the 30-year fixed jumped 45 basis points at the start of last week, then fell 41 basis points on Thursday and then rose again by 36 basis points. Mortgage rates don't move that much in a single increment.
The gain in refinancing has been falling since the beginning of the year. The week saw a 4% increase in applications. Some may have been taking advantage of the drop in rates to get the lower prices from previous weeks. When rates were close to 3%, refinancing was down 82%.
The number of mortgage applications to purchase a home was down for the week and year ago.
Despite the strong job market, the purchase market continues to experience a slowing. Five of the last six weeks have seen activity fall as buyers remain on the sidelines due to affordability and doubts about the strength of the economy.
The mortgage rates have been less volatile than last week. The consumer price index is a measure of inflation and will be released on Wednesday. The bond market pays close attention to this economic indicator.
All Rights Reserved © 2024
