Single family homes in residential areas of San Marcos, Texas.
Jordan Vonderhaar | Bloomberg | Getty Images
Mortgage demand rose last week after being flat the previous week, even as mortgage rates rose for a fourth straight week. Total applications increased 1.7% from the previous week, according to the Mortgage Bankers Association’s Seasonally Adjusted Index.
The average contract interest rate for a 30-year fixed-rate mortgage with qualifying loan balance ($766,550 or less) increased from 6.86% to 6.90%, and points for loans with 20% down payment increased from 0.60 (including origination fee) to 0.70 paid. This is the highest level since July.
Mortgage applications for home purchases increased 2% this week, but were down 1% from the same week a year ago. Purchase demand was driven by both conventional and FHA loans, with FHA purchase applications increasing 7%.
“For-sale inventory has eased in some markets, with some potential buyers able to take advantage of increased supply and lower FHA rates,” MBA economist Joel Kan said. (FHA) rates are slightly lower than the consistent 30-year fixed rate.
Home loan refinancing applications increased 2% this week and were 43% higher than the same week a year ago. Demand was driven by a 10% increase in VA applications.
Mortgage rates are essentially flat so far this week, according to a separate Mortgage News Daily survey. Shares were higher on Monday but fell on Tuesday on news that the United States had authorized Ukraine to use long-range missiles to attack Russia, which has threatened to respond with nuclear weapons. Bond yields fell as investors turned to safety.
“Relative to the headlines, the improvement in mortgage rates is downright impressive — perhaps because this is far from the first such threat from Russia, or because traders are wondering if anyone wants to press the button on Mutually Assured Destruction. “Any red button on the machine. ”, wrote Mortgage News Daily Chief Operating Officer Matthew Graham.
