Falling mortgage rates helped push total mortgage demand to the highest level in six weeks, according to the weekly data from the Mortgage Bankers Association.
- The Mortgage Market Index rose to 175.6 for the week, up 3% from last week and the highest level in six weeks.
Purchase Boom. The Purchase Index jumped to 138.4 for the week ending November 17th, up 4.0% from last week and the highest level in the last 8 weeks.
- Refis were at a six-week high after rising 1.6% an index of 359.9 for the week ending November 17th.
Falling Rates. Rates fell to their lowest level since September thanks to a beneficial inflation report last week. The average contract interest rate for 30-year fixed-rate mortgages fell to 7.41%, down 20 basis points from last week and the lowest level since September 24th.
- The 30-year fixed is now down almost 50 basis from the 7.91% peak on October 22nd.
Breaking It Down. The refinance share of mortgage activity increased to 32.4% of total applications while the adjustable-rate mortgage share of activity decreased to 8.3% of total applications.
Analysis. Joel Kan, MBA’s Deputy Chief Economist, noted that while mortgage demand is still extremely low we are seeing some positive movement for first-time buyers. “Mortgage applications increased to their highest level in six weeks, but remain at very low levels. Purchase applications were up almost four percent over the week, on a seasonally adjusted basis, as both conventional and government purchase loans saw increases. The average loan size on a purchase application was $403,600, the lowest since January 2023. This is consistent with other sources of home sales data showing a gradually increasing first-time homebuyer share.”
Big Picture. With mortgage demand slowly rising the only real question is have we bottomed or do we have more room to fall?