Mortgage demand fell from the previous week, marking the first decline in six weeks, as rising rates cooled the market slightly, according to the weekly data from the Mortgage Bankers Association.
- Total mortgage demand fell 1.3% from the prior week, the first decline in the last six weeks.
Refis: The weekly drop was driven primarily by a 2.7% decrease in refinancing applications, which also saw its first downturn in four weeks.
- Despite the overall decline in mortgage activity, purchase demand remained resilient, rising by 0.7% from the prior week. This marked the sixth consecutive week of gains, pushing purchase demand to its highest level since February.
Rates: The average contract interest rate for 30-year fixed-rate mortgages increased by one basis point to 6.14% for the week ending September 27th. This was the first uptick in mortgage rates in three months, contributing to the softening of the refinance market.
What They’re Saying: Mike Fratantoni, MBA’s SVP and Chief Economist, “The news for the week was that more homebuyers appear to be entering the market. Purchase application activity was up for the week and increased more than 9 percent compared to last year at this time. Inventories of both new and existing homes have been increasing over the course of 2024, meaning that potential buyers have properties to look at and now have somewhat lower mortgage rates leading to better affordability.”
Bottom Line: Mortgage rates remain near their lowest levels in almost two years, but high home prices and seasonal trends are still keeping mortgage demand subdued.
