Mortgage rates remained relatively stable last week, with only a slight decrease for 30-year fixed-rate mortgages. Despite this, homebuyers seem to be showing more interest in the market, with purchase applications increasing by 1% from the previous week. This is a 7% increase from the same week last year, indicating a slight resurgence in demand. The rise in purchase activity was primarily driven by an increase in FHA applications, as inventory loosens and mortgage rates slowly decline.
In contrast, refinance demand weakened last week, with applications decreasing by 5%. However, compared to the same week last year, refinance applications are still 63% higher. This could be due to homeowners taking advantage of lower rates to refinance their mortgages, especially those who bought their homes at higher rates in the past two years.
Overall, total mortgage application volume decreased by 2% from the previous week, primarily due to the drop in refinance applications. Mortgage rates have remained largely stable, with only a slight decrease in interest rates for conforming loan balances. The Federal Reserve’s decision to hold the funds rate at its current level, along with potential changes in trade policy, are key factors influencing the mortgage market. Despite the challenges posed by strong spring headwinds, homebuyers and refinancers are still showing interest in taking advantage of favorable market conditions.
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