Currently Reading

Mortgage Rates Plummet After News of Omicron Variant

Advertisement
Financials

Mortgage Rates Plummet After News of Omicron Variant

After a major decline in refinance activity with high mortgage rates, a new COVID-19 variant could cause a swift reversal


December 1, 2021
COVID financial graph
Image: Stock.adobe.com

Mortgage rates rose substantially during the week of Thanksgiving, causing a 15% decline in applications to refinance a home loan, CNBC reports. When news of the omicron variant was released on Friday, however, rates immediately began to drop. By Tuesday, the 30-year fixed average rate fell 15 basis points, a reversal partially caused by congressional testimony pushing the bond market in the opposite direction after three straight weeks of growth.

Last week the average rate on the 30-year mortgage with conforming loan balance ($548,250 or less) increased to 3.31% from 3.24%, with points rising to 0.43 from 0.36 (including the origination fee) for loans with a 20% down payment, according to the Mortgage Bankers Association. That is the highest rate since April of this year. The rate was 39 basis points lower one year ago.

The increase in rates caused applications to refinance a home loan to drop 15% for the week, seasonally adjusted. An additional adjustment was made for the Thanksgiving holiday. Refinance demand was 41% lower than the same week one year ago. The refinance share of mortgage activity decreased to 59.4% of total applications from 63.1% the previous week.

While rates rose for much of last week, they made a swift reversal on Friday, when news hit of the omicron variant. By Tuesday the average rate on the 30-year fixed had fallen 15 basis points, according to Mortgage News Daily.

Read More

Related Stories

Demographics

Homeownership Gap Between Black and White Americans Widest in 100 years

Before the 1960s passage of anti-discrimination laws, Black homeowners were still doing better than they are today

Economics

Consumer Price Index Points to Elevated Inflation and Higher Interest Rates in 2022

Inflation is at its highest peak since the early 1980s, and 2022 may see more gains

Financials

Why Separating Buyer Agent and Listing Agent Commissions Would Stir Up Competition

Separate commissions would cause a steep price decline if buyers could negotiate fees directly with their agents

Advertisement
Advertisement

More in Category




Advertisement
Advertisement

Create an account

By creating an account, you agree to Pro Builder's terms of service and privacy policy.


Daily Feed Newsletter

Get Pro Builder in your inbox

Each day, Pro Builder's editors assemble the latest breaking industry news, hottest trends, and most relevant research, delivered to your inbox.

Save the stories you care about

Lorem ipsum dolor sit amet lorem ipsum dolor sit amet lorem ipsum dolor sit amet.

The bookmark icon allows you to save any story to your account to read it later
Tap it once to save, and tap it again to unsave

It looks like you’re using an ad-blocker!

Pro Builder is an advertisting supported site and we noticed you have ad-blocking enabled in your browser. There are two ways you can keep reading:

Disable your ad-blocker
Disable now
Subscribe to Pro Builder
Subscribe
Already a member? Sign in
Become a Member

Subscribe to Pro Builder for unlimited access

Lorem ipsum dolor sit amet, consectetur adipisicing elit, sed do eiusmod tempor incididunt ut labore et dolore magna aliqua.