Buyers Make a Minor Comeback as Mortgage Rates Dip at the End of July

After dipping slightly at the end of July, the average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances of $647,200 or less rose once again from 5.43% to 5.47% during the first week of August, CNBC reports. The latest shift in borrowing costs caused slight gains in refinancing but declines in applications from homebuyers, marking the sixth consecutive week of near stagnant buyer activity. 

Refinancing applications rose 4% for the week, while mortgage applications to purchase a home fell 1% and were down 19% year-over-year. Wednesday’s newest consumer price index will determine whether or not buyers decide to make their move after months of volatility in a cooling market, but price deceleration likely won’t leave much of a mark for months to come.

“The purchase market continues to experience a slowdown, despite the strong job market,” said Joel Kan, MBA’s associate vice president of economic and industry forecasting. “Activity has now fallen in five of the last six weeks, as buyers remain on the sidelines due to still-challenging affordability conditions and doubts about the strength of the economy.”

Mortgage rates fell slightly to start this week and have been far less volatile than last week. That could change Wednesday with the release of the latest consumer price index, which measures inflation in the economy.

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