Falling mortgage rates weren’t enough to keep mortgage demand from falling as total demand fell 0.8%, according to the weekly survey from the Mortgage Bankers Association.
- Purchases were actually up 4.0% for the week but are still down 41% when compared to the same time last year.
- Refis fell 13% for the week and are now down 86% when compared to the same time last year.
Breaking It Down. The refinance share of mortgage activity fell 2.3 percentage points to 26.1% of total applications and the adjustable-rate mortgage share of activity increased to 9.0% of total applications.
Mortgage Rates. Rates continued to fall with the 30-year fixed rate falling to 6.49%, this is down 18 basis points from last week and down 67 basis points from the high on October 21st. However, even with the recent drops, the 30-year rate is still a whopping 318 basis points higher than one year ago.
- The 15-year fixed fell 4 basis points to 6.02% and the 5/1 ARM fell 30 bips to 5.48%.
Analysis. Joel Kan, MBA economist, was optimistic about rates moving forward. “Mortgage rates declined again last week, following bond yields lower. The 30-year fixed mortgage rate decreased to 6.49 percent and has now fallen 57 basis points over the past four weeks. Additionally, mortgage rates for most other loan types declined…The economy here and abroad is weakening, which should lead to slower inflation and allow the Fed to slow the pace of rate hikes.”