US Home Purchase Applications Fall After Prior Week's Surge
The Mortgage Bankers Association's index of home-purchase applications slumped 11.8% in the week ended July 11, data from the group showed Wednesday. While that marked the biggest drop since 2022, it followed a 9.4% jump in the previous week that included Independence Day. The figures are prone to wide swings around holidays even though the data are adjusted for seasonal effects.
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Yahoo
2 days ago
- Yahoo
Mortgage rates hold steady at 6.74%
Mortgage rates remained basically flat this week, following two straight weeks of increases. According to data from Freddie Mac, the average rate on a 30-year fixed mortgage was 6.74% for the week ending Wednesday, down just a single basis point from 6.75% the week prior. The average 15-year fixed mortgage rate was 5.87%, down five basis points from 5.92% last week. Read more: Will mortgage rates ever be 3% again? 'Overall, the backdrop for the housing market is positive as the economy continues to perform well with solid employment and income growth,' said Sam Khater, Freddie Mac's chief economist. Applications to purchase a home were up 3% from a week ago, according to data from the Mortgage Bankers Association, while refinancings fell 3%. 'We expect overall demand to ebb and flow as long as mortgage rates remain volatile due to the ongoing economic uncertainty,' said Bob Broeksmit, MBA CEO and president. Sign up for the Mind Your Money weekly newsletter By subscribing, you are agreeing to Yahoo's Terms and Privacy Policy As mortgage rates remain elevated, home sales could hit an all-time low this year. According to research by sales volume for existing homes is expected to fall 1.5% annually, to just 4 million transactions. At the start of 2025, sales volume for homes had been expected to increase slightly from last year's level of 4.06 million — another all-time low. Sign up for the Mind Your Money newsletter Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Miami Herald
2 days ago
- Miami Herald
The Mortgage Rate Shift That Could Change the Housing Market
Owning a home remains prohibitively expensive for many Americans, but experts believe a modest decline in mortgage rates could inject much-needed momentum into home sales and help revive the broader U.S. housing market. According to recent analysis from the National Association of Realtors (NAR), were mortgage rates to drop to 6 percent, an additional 5.5 million households would be able to afford a home, including 1.6 million renters. Affordability remains one of the key issues threatening the stability of the U.S. housing market. As experts have warned, the rising costs of buying a home-which have dragged ownership rates to a post-pandemic low this year-are exacerbated by persistently high borrowing costs, preventing a large number of Americans from entering the property market. Economists have recently pointed to higher-than-usual mortgage rates as a critical drag on the U.S. housing market, and others are now dubbing a possible drop to 6 percent as a "magic" figure that would expand the number of Americans who are able to buy. According to data from key organizations within the housing and mortgage markets, including the Mortgage Bankers Association (MBA) and the Federal Home Loan Mortgage Corporation (Freddie Mac), 30-year fixed mortgage rates are currently hovering at around about 6.75 percent. While these are below the levels seen in October 2023, when 30-year rates surged to around 8 percent, they are a far cry from the lows of under 3 percent during the pandemic. The rates have pushed homeownership out of reach for many. According to Housing Market Trends Report for June, the number of homes for sale in the U.S. rose nearly 30 percent year over year, marking the 20th straight month of increases. The latest market report from Zillow similarly showed that housing inventory hit a five-year high in June. NAR's research found that even a modest drop in rates to 6 percent would boost home sales by an estimated 3 percent in 2025 and by 14 percent in 2026. It added that approximately 10 percent of the additional households now able to buy would do so over 12 to 18 months. According to Mortgage News Daily's loan calculator, a 6 percent rate on 30-year mortgages would lower the monthly payment on a $300,000 loan to $1,799 from $1,946 at today's rates. NAR said that Atlanta, Dallas, Minneapolis, Cleveland, and Kansas City would see the greatest increase in home sales activity if rates dropped to 6 percent. Susan Wachter, an economist and professor of finance and real estate at the University of Pennsylvania's Wharton business school, told Newsweek that 6 percent could prove "a magic mortgage number that will push Americans to buy." However, she added that this will depend on the direction of inflation, and the Federal Reserve's response in the form of lower interest rates. Alexei Morgado, real estate agent and founder of Lexawise, told "Many of my clients tell me the same thing: They want to buy, but they feel that mortgage rates are holding them back." "And it's not just about the number itself," he continued. "What I hear most often is the fear of making a bad decision, of getting into something they can't sustain or that will later make them think, 'I rushed into it.' That feeling of paying more for the same thing is frustrating, discouraging, and puts them on hold." Susan Wachter of theUniversity of Pennsylvania's Wharton School told Newsweek: "Six percent could be a magic mortgage number that will push Americans to buy, but only if it comes about because inflation declines, bringing interest rates down, without a recession. The fear of buyers' remorse in a housing slowdown is sidelining buyers, including those who would newly qualify for a mortgage with rate drops." NAR Chief Economist Lawrence Yun, speaking to real estate professionals at the Residential Economic Issues & Trends Forum last month, said: "Your past clients are all happy. But for new homebuyers, their monthly payment obligation has increased, and this is what's killing the housing market. Mortgage rates are the magic bullet, and we're waiting and waiting until those come down." NAR Chief Economist Yun forecasts that mortgage rates will average 6.4 percent in the second half of 2025, and 6.1 percent next year. Related Articles Map Shows Cities Where Residents Are Looking to Move AwayYou Can Now Co-Own a 6-Bed Montecito MansionHow Tax Breaks for Homeowners Can Affect Your 2025 ReturnsHow Much Boomers, Millennials and Gen Z Spent on Their Homes in 2024 2025 NEWSWEEK DIGITAL LLC.
CNBC
3 days ago
- CNBC
Mortgage demand flatlines at low levels, as mortgage rates hit 4-week high
Mortgage rates rose last week to the highest level in four weeks, but mortgage demand didn't really move. Total mortgage application volume increased 0.8% last week from the previous week, according to the Mortgage Bankers Association's seasonally adjusted index. The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances, $806,500 or less, increased to 6.84% from 6.82%, with points remaining unchanged at 0.62, including the origination fee, for loans with a 20% down payment. Applications to refinance a home loan, which are most sensitive to weekly rate moves, fell 3% for the week and were 22% higher than the same week one year ago, when interest rates were just 2 basis points lower. While the annual jump may seem large, that's only because the volume is so very small. Applications for a mortgage to purchase a home rose 3% for the week and were also 22% higher than the same week one year ago. "After reaching $460,000 in March 2025, the purchase loan amount has fallen to its lowest level since January 2025 to $426,700," said Joel Kan, an MBA economist. "With the 30-year fixed rate still too high to benefit many borrowers, refinance applications were down almost three percent for the week." CNBC's Property Play with Diana Olick covers new and evolving opportunities for the real estate investor, delivered weekly to your inbox. Subscribe here to get access today. Mortgage rates moved slightly lower to start this week, according to a separate survey from Mortgage News Daily. Markets reacted positively Tuesday morning to details from Treasury Secretary Scott Bessent's thoughts on whether or not Federal Reserve Chairman Jerome Powell would leave office early. Last week, bond yields rose on concerns he might. "In not so many words, Bessent told Trump not to fire Powell and this morning's [Tuesday's] coverage just expanded on that sentiment," wrote Matthew Graham, chief operating officer of Mortgage News Daily. "The Bessent news helped the bond market begin the day in stronger territory."
