Purchase Applications Rise While Mortgage Rates and Refis Dip
Mortgage rates fell slightly this week, dropping from 2.99% to 2.96%. While that apparently helped homebuyers, refinancers, on the other hand, fell back.
According to the Mortgage Bankers Association, purchase loan applications were up 0.3% over the week, while refinances were down 5%. Both measures are still down considerably over the year, but this is likely the result of the recent holiday weekend.
“With fewer homeowners able to take advantage of lower rates, the refinance share dipped to the lowest level since April,” said Joel Kan, MBA’s associate vice president of economic and industry forecasting. “Purchase applications were up slightly last week, and the large annual decline was the result of Memorial Day 2021 being compared to a non-holiday week, as well as the big upswing in applications seen last May once pandemic-induced lockdowns started to lift.”
Another number that dropped? That’d be the average loan amount, which fell to $407,000 for purchase applications — down from $418,000 the week prior. It’s still far above last year’s average of $353,900.
“Home-price growth continues to accelerate, driven by favorable demographics, the recovering job market and economy, and housing demand far outpacing supply,” Kan said.
More in mortgage & housing news
- It got slightly easier to get a mortgage in April, according to MBA. The group’s recent mortgage credit availability index rose 1.4% for the month, indicating lending standards are getting looser. Jumbo and conventional loans saw the most loosening.
- The share of mortgage loans in forbearance fell to 4.16% this week, down from 4.18%. According to MBA, about 2.1 million homeowners are still on a forbearance plan.
- A report from Redfin shows that the market may finally be “leveling off.” According to the data, pending sales declined 3% in May, and asking prices started to cool, too. The median asking price fell by $2,500.
- Realtor.com data shows that homes are selling 35 days faster than last year. Meanwhile, new listings fell 1% last week, the first dip in eight weeks.
This week in mortgage rates
Mortgage rates fell across all major loan products this week.
Here’s how rates looked for each loan type:
- Conforming 30-year, fixed-rate loans: 2.96% (down from 2.99%)
- 15-year, fixed-rate loans: 2.23% (down from 2.27%)
- 5/1 adjustable-rate loans: 2.55% (down from 2.64%)
Make sure to check back here next week for the latest mortgage news.
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