In the last week of 2018, mortgage interest rates hit a four month low, yet total mortgage application volume fell by nearly double digits over the previous two weeks.
The Mortgage Bankers Association's seasonally adjusted index reading says volume fell 9.8 percent in the last week of the year from two weeks prior, and rates have fallen even more in the starting days of 2019, matching the spring 2018 low level, per Mortgage News Daily. Rates may continue to trend downward as bond demand remains strong, though they may also reverse; Mortgage News Daily CEO Matthew Graham tells CNBC, "If economic data is exceptionally strong in the coming days, or if stocks find a reason to surge significantly higher, the party might be over for the time being."
While most housing data can be "noisy" around the holidays, depending on which days of the week businesses are closed, there is arguably a slowdown in the housing market. Buyers are still facing high prices, although the gains continue to shrink. Local markets are seeing an increased supply of homes for sale, and that has some sellers reducing their asking prices. But buyers are also faced with rising uncertainty in the economy, a volatile stock market that has seen significant losses, and a partial government shutdown.
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