Mortgage demand increased for the third straight week as rates fell for the fourth straight week, according to the latest data from the Mortgage Bankers Association (MBA).
- Total mortgage applications rose by 1.6% for the week ending last Friday, building on a 0.5% gain the previous week.
- This marks the largest increase in applications over the last three weeks.
Purchases: The rise in demand was driven primarily by an uptick in purchase applications, which jumped 3.2% from the previous week, signaling renewed interest in home buying.
- On the flip side, refinance applications dipped by 0.3%, as fewer homeowners looked to refinance at current rates.
Rates Fall: The boost in mortgage activity is largely tied to a continued decline in mortgage rates. The average contract interest rate for a 30-year fixed-rate mortgage fell to 6.43%, a one-basis-point drop from the previous week. This marks the fifth consecutive week of falling rates, offering some relief to prospective homebuyers after a period of rising borrowing costs.
The bottom line: Mortgage demand is on the rise, but the market remains mixed. Purchase applications are up, driven by falling rates, while refinance demand stays tepid as many homeowners stick with their existing loans.
