Despite another drop in interest rates, demand for refinancing and buying mortgages fell last week, with the total volume of mortgage applications down 4.8% from the previous week, according to the Mortgage Bankers Association.
Record low interest rates are obviously not as impressive as before, probably because interest rates have been so low for so long.
The average contractual interest rate for 30-year fixed-rate mortgages with a corresponding loan balance of up to $ 510,400 fell to 3.05% from 3.1
Housing loan refinancing applications, which are usually sensitive to weekly interest rate movements, still fell 7% for the week, although they were still 52% higher than a year ago, according to the seasonally adjusted index. .
“There are indications that refinancing rates are not declining to the same extent as home loan rates, and this may explain last week’s decline in refinancing,” said Joel Kahn, an MBA economist. “Many lenders are still working at full capacity and working through operational challenges, ultimately limiting the number of applications they can accept.”
Mortgage applications for the purchase of housing decreased by 2% for the week and were 22% higher than before. This is a slightly lower annual profit than the previous week. Demand for housing has been extremely strong in recent months, as demand has been holding back since the pandemic spring, combined with the ensuing desire for larger suburban homes.
However, supply is far less than demand and this is igniting fires in house prices, which are rising in double digits in some markets. Most of the commercial activity is now at the upper end of the market, where there is more supply.
“Even when the restrained demand from earlier in the year weakens, there is still action at higher price levels, with the average loan balance remaining close to the all-time record,” Cannes added.