Mortgage Rates Steadily Decline, but Low Housing Supply Keeps Buyers Out of the Game
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances fell to a four-week low of 3.27% from 3.30% the week prior. Applications to refinance a home loan increased 2% from the previous week but remain 42% lower year-over-year, CNBC reports. Applications for a mortgage to purchase a home dropped 3% for the week and were 9% lower than the number reported during the same week one year ago, likely because of a dwindling supply of homes for sale.
Even a small drop in interest rates couldn’t bring more buyers in, although it did boost refinance demand slightly. As a result, total mortgage application volume last week was essentially unchanged, falling 0.6% from the previous week, according to the Mortgage Bankers Association’s seasonally adjusted index.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($548,250 or less) decreased to 3.27% from 3.30%, with points increasing to 0.41 from 0.39, including the origination fee, for loans with a 20% down payment. The rate was 41 basis points lower the same week one year ago.