Mortgage demand ended the year exactly as you would have expected. Total demand fell over 13% thanks to a double-digit drop in both purchases in refis, according to the weekly survey from the Mortgage Bankers Association.
- Purchase demand was down 12.2% from two weeks ago and ended the year down 42%.
- Refi demand fell 16.3% from two weeks ago and ended the year down 87%.
Breaking It Down. The refinance share of mortgage activity jumped 1.5 percentage points to 30.3% while the adjustable-rate mortgage share of activity continued to fall ending that year at 7.3% of total applications.
Rates Up. Rates were up across the board with 30-year fixed closing out the year at 6.58%, this is 16 basis points higher than two weeks ago and ends the year up 323 basis points.
- The 15-year fixed ended the year over six percent at 6.06% while the 5/1 ARM ended the year at 5.61%.
Analysis. Joel Kan, MBA’s Vice President and Deputy Chief Economist, said mortgage demand ended the year at a 26-year low. “The end of the year is typically a slower time for the housing market, and with mortgage rates still well above 6 percent and the threat of a recession looming, mortgage applications continued to decline over the past two weeks to the lowest level since 1996,”