Last week, average contract interest rates dropped, total mortgage application volume grew, and homebuyer demand fell. The Mortgage Bankers Association’s seasonally adjusted index found the average contract interest rate for fixed-rate 30-year mortgages with loan balances up to $510,400 dropped by .07% to 3.19%, according to CNBC. Home loan refinancing applications grew by 12% last week, making the year-over-year change 107%. Although interest rates dropped, homebuyer demand fell last week by 6%, but demand remains 16% stronger than last year. The year-over-year change for homebuyer demand is now only half of what it was two weeks ago.
It almost doesn’t sound like news anymore: Mortgage rates fell to another record low last week, and that reinvigorated refinance demand. Homebuyers, however, took a step back.
Total mortgage application volume rose 5.1% last week compared with the previous week, according to the Mortgage Bankers Association’s seasonally adjusted index.
Mortgage demand got a lift from another big drop in mortgage rates. The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances of up to $510,400 decreased to 3.19% from 3.26%. Points, including the origination fee, decreased to 0.33 from 0.35 for loans with a 20% down payment. That rate is 63 basis points lower than the recent high in late March.