Rates Fall But Remain Near 7%

Mortgage rates fell further last week but remain near 7%, putting pressure on affordability. Officials at Freddie Mac reported Thursday that the 30-year fixed-rate mortgage averaged 6.95%, down from the week prior’s 6.99%. A year ago at this time, the 30-year FRM averaged 6.69%. The 15-year also fell to 6.17% from 6.29%. A year ago at this time, it was 6.10%. “Mortgage rates continued to fall back this week as incoming data suggests the economy is cooling to a more sustainable level of growth,” said Sam Khater, Freddie Mac’s Chief Economist. “Top-line inflation numbers were flat but shelter inflation, which measures rent and homeownership costs, increased showing that housing affordability continues to be an ongoing impediment for buyers on the…

Federal Reserve Not Budging On Rates Yet

By PATRICK LAVERY For the seventh straight meeting, dating back to last September 20, the Federal Open Market Committee on Wednesday voted to maintain the target range for its federal funds rate at 5.25% to 5.5%. That officially means, as experts and prediction tools had almost unanimously agreed going into the week, that the earliest there will be a change to the key rate is after the next FOMC summit on the final two days of July, one year since the last quarter-point increase, and there is skepticism anything will happen then either. In a public statement released after the vote was taken, the FOMC was perhaps not as pessimistic as in the past that the rate might in fact…

Mortgage Lock Volumes Jumped 7% Last Month

Mortgage rate lock volumes jumped nearly 7% in May despite rates moving very little. Mortgage Capital Trading’s (MCT) latest report revealed that mortgage lock volume increased 6.78% month-over-month in May. Rates have been the primary influence on mortgage activity this year. MCT says the industry is monitoring economic data to see what decisions the Federal Reserve will make in the future. “The next couple of months will be key from a data standpoint as the Federal Reserve looks for a trend of inflation heading towards the goal of two percent. Considering the Nonfarm Payroll number that just came out, setting a trend is going to take more time,” said Andrew Rhodes, Senior Director and Head of Trading at MCT. “We’re…

Rates Fall 11 BPS, Applications Rally

Mortgage applications rallied last week as a slowing jobs market and positive indications from the Central Bank led to rates plummeting.  The Mortgage Bankers Association’s weekly survey shows that the adjusted Market Composite Index — a measure of mortgage loan application volume — rose by 2.6%, reversing last week’s 2.3% dip. Adjusted purchase applications increased by 2%, while the unadjusted index was up 2% and 17% lower YOY.  Rates declined for the first time since March, falling a full 11 bps to 7.18%. FHA loans drove the upward push, jumping 5%, as their rates plummeted to 6.92%. It’s been weeks since these rates were last below 7%. “First-time homebuyers account for roughly half of purchase loans, and the government lending…

Feds Hold Steady On Rates, No Hints On When Cuts May Occur

By PATRICK LAVERY Predicted by both the experts and projection tools alike, the Federal Open Market Committee on Wednesday decided to maintain its target range for the federal funds rate at 5.25% to 5.5%, the sixth consecutive meeting at which the key rate has gone unchanged following a year and a half’s worth of increases. In prepared remarks, Federal Reserve Chair Jerome Powell echoed previous statements over the past eight months in which he indicated that inflation continues to move too slowly, at least for the Fed’s liking, toward its ultimate goal of 2% to warrant any shift – although according to the data Powell provided, that may be more within reach than previously thought. Total Personal Consumption Expenditures prices…

Applications Slip Again Ahead Of FOMC Meeting

Mortgage applications declined again last week as rates continued their upward march.  The Mortgage Bankers Association’s weekly survey shows that the adjusted Market Composite Index — a measure of mortgage loan application volume — fell by 2.3%, adding to last week’s 2.7% dip. Adjusted purchase applications slipped by 2%, while the unadjusted index was down 1% and 14% lower YOY.  Rates jumped to 7.29%, their highest point since November 2023. “Inflation remains stubbornly high, and this trend is convincing markets that rates, including mortgage rates, are going to stay higher for longer,” said Mike Fratantoni, MBA’s SVP and Chief Economist.  As buyers desperately seek ways to lower their monthly payments, ARMs clocked another strong week, accounting for 7.8% of applications.…

Rate Watchers To Keep Close Eye On The Fed

By PATRICK LAVERY After a swift acceleration of more than five percentage points in about a year and a half, starting in early 2022, could the Federal Reserve Board keep its policy interest rate in a holding pattern for close to a year? That appears likely, as with no change since last summer, most experts feel the Fed is poised to keep the key rate steady – at a range of 5.25% to 5.5% – when the Federal Open Market Committee emerges from its next two-day summit on Wednesday. CME Group’s FedWatch tool has been a valuable resource for Fed meeting predictions in recent months, and once again, its degree of confidence that the Fed will stand pat this week…

Rates Move Down Slightly

Mortgage rates fell last week but remained in the high-6% range. Officials at Freddie Mac reported Thursday that the 30-year fixed-rate mortgage averaged 6.79%, down from the week prior’s 6.87%. A year ago at this time, the 30-year FRM averaged 6.32%. The 15-year fixed rate also dropped from 6.21% to 6.11%. A year ago, it averaged 5.56%.  “Mortgage rates moved slightly lower this week, providing a bit more room in the budgets of some prospective homebuyers,” said Sam Khater, Freddie Mac’s Chief Economist.  “We also are seeing encouraging data on existing home sales, which reflects improving inventory. Regardless, rates remain elevated near 7% as markets watch for signs of cooling inflation, hoping that rates will come down further.” Both existing…

Rates Back Up To Near 7%

Rates took a turn for the worse last week, rising back to nearly 7%, as economic data soured analysts’ moods on easing rates. Officials at Freddie Mac reported Thursday that the 30-year fixed-rate mortgage averaged 6.87%, up from the week prior’s 6.74%. A year ago at this time, the 30-year FRM averaged 6.42%. This breaks a two-week streak of declines. Mortgage applications slipped this week as rate-sensitive Americans backed away from the market.  The 15-year fixed rate also rose from 6.16% to 6.21%. A year ago, it averaged 5.68%. The Central Bank outlined cuts to come in 2024 but held the benchmark rate steady during their March meeting. Inflation has eased over the past year but committee members do not…

Rates Near 7% Send Applications Tumbling

Mortgage applications are yo-yoing as affordability-minded buyers respond to fluctuating rates. The Mortgage Bankers Association’s weekly survey shows that the adjusted Market Composite Index — a measure of mortgage loan application volume — decreased by 1.6%, following the week prior’s 7.1% bump. Adjusted purchase applications slipped by 1%, while the unadjusted index was down 1% and 14% lower YOY.  Rates drove the downturn, as they jumped to 6.97% after three weeks of decreases. Too-hot inflation data is moving rates around, though they have mostly stayed in the mid- to high-6’s. “Mortgage applications continued to show sensitivity to rate movements, and both purchase and refinance activity decreased over the week. With housing supply low and prices high, the average loan size…