There is a sign in front of a home.
The already competitive housing market is getting even more competitive.
Even a small drop in interest rates couldn't bring in more buyers. Total mortgage application volume was essentially unchanged last week, falling 0.6% from the previous week according to the Mortgage Bankers Association.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances decreased to 3.30% from 3.30%, with points increasing to 0.41 from 0.39 for loans with a 20% down payment. The rate was lower a year ago.
The number of home loan applications increased 2% from the previous week but were 42% lower than a year ago. The share of mortgage activity that was refi increased to 65.2% from 63.3%. There is a diminishing population of borrowers who can benefit from a refinance given how much lower rates were a year ago.
The number of mortgage applications to purchase a home fell 3% for the week and were 9% lower than a year ago.
It is possible that buyers simply can't find a home they like, it is not necessarily that buyer demand has fallen off. The number of homes listed for sale at the end of November was the lowest on record. Prices are still rising at a fast clip, and supply is leanest on the low end of the market.
The average purchase loan increased for the second straight week to $416,200, the second-highest amount ever. The elevated loan size is an indication that activity is more on the higher end of the market, according to the associate vice president of economic and industry forecasting.
The stock market recovered from several down days and mortgage rates started to rise. The market volatility brought on by the Covid omicron variant is expected to cause rates to move higher.
