Rates Dip, But Purchase Applications, Refis Still Lag
Mortgage rates dropped again, this time hitting a mere 2.77% on 30-year loans, while rates on 15-year mortgages are still at a record low, clocking in at just 2.10%.
According to Sam Khater, chief economist at Freddie Mac, the drops are largely due to the pandemic.
“With global market uncertainty surrounding the Delta variant of COVID-19, we saw 10-year Treasury yields drift lower and consequently mortgage rates followed suit,” Khater said. “The 30-year fixed-rate mortgage dipped back to where it stood at the beginning of 2021, and the 15-year fixed remained at its historic low. This bodes well for those still looking to refinance, renovate or even purchase a new home.”
Unfortunately, it doesn’t seem like buyers or homeowners are leveraging these low rates. According to the Mortgage Bankers Association, overall loan applications are down for the week.
Applications to purchase a home dipped 2% over the week and are now 18% below last year’s numbers. Refinances dropped 2% compared to last week as well.
“Refinance application volume slightly decreased, following an 11% jump last week,” said Mike Fratantoni, MBA’s senior vice president and chief economist. “Purchase application volume decreased again, reflecting the ongoing lack of inventory that continues to drive rapid home-price appreciation across the country.”
More in mortgage & housing news
- The CDC eviction ban expired over the weekend, only to be revived by Tuesday evening. The ban will apply to renters in counties where COVID-19 transmission is either “high” or “substantial.”
- The latest CoreLogic Home Price Index shows that house prices rose 17.2% nationally between June 2020 and June 2021. Prices were up 2.3% over the month.
- ATTOM Data Solutions just reported that home sale profits fell in the second quarter, dipping from an average 48.4% return on investment to a 44.9% one. The average sellers made a profit of $94,500 in that quarter.
- New listings were up 5% this week, according to Realtor.com. New listings have increased in 16 of the last 19 weeks.
This week in mortgage rates
Mortgage rates fell on all mortgage products this week.
Here’s how rates looked for each loan type:
- Conforming 30-year, fixed-rate loans: 2.77% (down from 2.80%)
- 15-year, fixed-rate loans: 2.10% (down from 2.12%)
- 5/1 adjustable-rate loans: 2.40% (down from 2.49%)
Make sure to check back here next week for the latest mortgage news.
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