Mortgage Applications See Pronounced Weekly, Monthly and Yearly Drops

The number of Americans filing mortgage applications dropped by several critical short-term metrics this week as signs abounded of an ongoing homebuying slowdown across the country. The Mortgage Bankers Association this week recorded a nearly four percent drop in mortgage applications week over week, posting a 3.9 percent decline in applications relative to the prior seven days. The weekly drop comes after the MBA revealed a yearly drop of more than 25 percent as well as a month-over-month drop of about four percent. MBA Associate Vice President of Economic and Industry Forecasting Joel Kan pointed out in the weekly report that “mortgage rates were at their highest levels in around a month, with the 30-year fixed rate increasing above 3…

Mortgage Applications Plummet Year-Over-Year, Decline From Last Month

Mortgage applications declined sharply in the past month, plummeting year-over-year and seeing a small but still pronounced decline from the prior month. Applications for new home purchases “decreased 27.4 percent compared from a year ago,” the Mortgage Bankers Association said in its weekly application report. Meanwhile, compared to June 2021, applications decreased by 4 percent.” MBA Associate Vice President of Economic and Industry Forecasting Joel Khan suggested the steep drop is not as dire as it initially appears. “Mortgage applications for new home purchases declined in July – as is typical most summers when home sales start to moderate – but did come in at the second-strongest July reading since the inception of MBA’s survey in 2012,” he argued in…

Forbearance Decline Accelerates as Economic Outlook Improves

The number of homeowners exiting mortgage forbearance increased this week, continuing an optimistic trend that comes alongside steadily improving economic numbers. The “total number of loans now in forbearance decreased by 14 basis points from 3.40% of servicers’ portfolio volume in the prior week to 3.26%,” the Mortgage Bankers Association said in its weekly forbearance report. The drop comes after a similar decrease last week; the decline has been ongoing for over a month, occurring alongside a limping but consistent economic recovery. “The largest decrease in a month in the share of loans in forbearance came from a jump in forbearance exits, as many homeowners are nearing the end of their forbearance terms,” MBA Chief Economist Mike Fratantoni said in…

Markets Across the Country See Dips in Home Sales as Cooldown Continues

Multiple diverse housing markets across the U.S. are continuing to observe pronounced dips in home sales as the white-hot real estate market continues a small but steady cooldown after a year of frenzy. In Des Moines, Iowa, home sales were down more than two percent month-over-month in July and nearly seven percent year-over-year. That drop comes amid a notable dip in the number of homes for sale on the market. In Indianapolis, meanwhile, a “year-long streak in increasing sales” came to an end last month, with a roughly identical drop in year-over-year sales as was observed in Des Moines. The “last time area sales fell on a year-over-year basis was in June 2020,” the Indianapolis Business Journal reports. Nashville saw…

Interest Rates Move Up Slightly Following Stronger Jobs Report

Mortgage rates ticked up in the past week amid a modestly brighter economic outlook, the first time rates have increased in weeks even as signs of a housing cooldown have persisted elsewhere. The 30-year fixed rate “increased by ten basis points week over week” after a six-week decline, Freddie Mac said in its weekly interest rate report. Specifically, the 30-year rate jumped from 2.77 percent last week to 2.87 percent this week; the rate still remains lower than where it stood a year ago, at 2.96 percent. The 15-year rate, meanwhile, rose five basis points to 2.15 percent, while the 5-year ARM rose from 2.40 percent to 2.44 percent. Freddie Mac Chief Economist Sam Khater said the jumps follow “broad…

Mortgage Applications Increase, Continuing Weekly Up-and-Down Trend Amid Economic Uncertainty

The number of mortgage applications filed by Americans over the past week increased, prolonging a whipsaw back-and-forth trend that continues to seesaw amid a relatively steady yet still uncertain economic recovery. Mortgage applications “increased 2.8 percent on a seasonally adjusted basis from one week earlier,” the Mortgage Bankers Association said in its weekly report on the subject. The increase comes after a decrease the week prior, which itself followed an increase the week before that, in a cycle that has persisted for weeks. “Mortgage applications rebounded last week, including an increase in purchase applications for the first time in nearly a month,” MBA Associate Vice President of Economic and Industry Forecasting Joel Kan said. “The higher level of purchase activity…

Housing Stock Jumps, Signaling Possible Upcoming Price Relief

Housing stock jumped notably throughout the country over the past month, signaling a possible turning point in the red-hot housing market that has kept prices elevated for well over a year. Realtor’s July 2021 housing data release “reveals signs of a positive change in the market for homebuyers,” the company said, with lower prices and higher stock offer potential signs of relief for buyers who have been frustrated by ever-rising prices. “Median listing prices are continuing to cool,” Realtor said, while “newly listed homes grew by 6.5% on a year-over-year basis, and remained stable on a month-over-month basis.” The total number of active listings is still significantly down year-over-year, but “new sellers are beginning to enter the market at close…

Mortgage Forbearance Falls Again, Continuing Months-Long Trend

The share of U.S. mortgages in forbearance fell again this week, continuing a months-long trend of declining dire straits for American homeowners. The Mortgage Bankers Association said in a press release on Monday the number of mortgage forbearances—in which banks agree to put collection and enforcement of loans temporarily on hold—decreased by seven basis points, from 3.47 percent to 3.40 percent. The decrease comes after several months of similar decline in forbearance rates, an indication of the U.S.’s steady albeit at-times limping economic recovery over the first half of 2021. “Forbearance exits increased as August began, and new forbearance requests declined, resulting in the largest decrease in the share of loans in forbearance in three weeks,” MBA Senior Vice President…

Freddie Mac Launches Streamlined Renovation Mortgage Product

Financial and mortgage powerhouse Freddie Mac has launched a streamlined renovation mortgage tool it says will help homebuyers more easily fold home projects into existing mortgages. The corporation’s CHOICEReno eXPress presents “an additional financing option for borrowers who are looking to finance smaller-scale home renovations,” Freddie Mac said in announcing the program. The loan program “allows homebuyers to include renovation costs in the mortgage financing to assist in addressing the aging housing supply, the need for affordable housing and the increasing demand for aging-in-place housing solutions,” the corporation said in a FAQ. Loans for renovations must generally be kept to 10 percent of the home’s value. The program offers “more affordable loan terms than using credit cards or unsecured financing…

Underwater Mortgages Drop, Equity-Rich Properties Increase

The number of mortgages underwater across the U.S. has dropped markedly, while the amount of “equity-rich” properties has jumped, according to recent housing data. Real estate data firm ATTOM said in a Thursday report that “just 4.1 percent of mortgaged homes, or one in 24, were considered seriously underwater in the second quarter of 2021.” An “underwater” mortgage is one in which the mortgage itself is worth more than the property it was taken out on. The current underwater rate “was down from 5.2 percent of all U.S. properties with a mortgage in the prior quarter and 6.2 percent, or one 16 properties, a year ago,” ATTOM said. The company also noted that “equity rich” homes—those in which “the combined…