Mortgage Rates Rise Slightly, While Applications Slip
Mortgage rates ticked up slightly this week, sending applications both to purchase a home and refinance one downward.
According to Freddie Mac, the average rate on 30-year, fixed-rate loans was 2.99% this week, up from 2.95% the week prior. As a result of the uptick, the Mortgage Bankers Association reported a 3% decrease in purchase applications and a 5% decrease in refinancing.
“Mortgage applications decreased for the second week in a row, with the overall index reaching its lowest level since February 2020,” said Joel Kan, MBA’s associate vice president of economic and industry forecasting. “Tight housing inventory, obstacles to a faster rate of new construction, and rapidly rising home prices continue to hold back purchase activity.”
Homebuyer demand for government-backed loans — including USDA, VA, and FHA mortgages — also declined for the week.
“The government purchase index declined to its lowest level in over a year and has now decreased year-over-year for five straight weeks,” Kan said. “Purchase applications were down almost 2% from a year ago, but that was compared to the week of Memorial Day 2020.”
More in mortgage & housing news
- The number of mortgage loans in forbearance fell to 4.19% for the week, according to MBA. About 2.1 million homeowners are still on a mortgage forbearance plan.
- Fannie Mae and Freddie Mac have extended mortgage forbearance options for multifamily borrowers through September 30. They were previously set to expire this month.
- New data from Realtor.com shows that homes are selling over a month faster than this time last year. Sale time declined the most in Pittsburgh, Detroit, and Rochester, N.Y. Redfin data shows that 57% of homes sold are under contract within two weeks, and 44% are under contract within one.
- Over half of homes listed are selling for above listing price, according to Redfin. That’s up from just one in four a year ago.
This week in mortgage rates
Mortgage rates increased or held steady on all loan products this week.
Here’s how rates looked for each loan type:
- Conforming 30-year, fixed-rate loans: 2.99% (up from 2.95%)
- 15-year, fixed-rate loans: 2.27% (steady from last week)
- 5/1 adjustable-rate loans: 2.64% (up from 2.59%)
Make sure to check back here next week for the latest mortgage news.
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