Mortgage rates fall for first time in months
Mortgage rates dipped slightly last week for the first time in more than two months amid the
The MBA's weekly survey shows the 30-year fixed-rate mortgage rate falling to 7.06 percent, down from 7.16 a week earlier, and applications decreasing for the sixth straight week. Rates, however, remained near the highest level in two decades.
The share of adjustable-rate mortgages, which rose recently as mortgage rates surged, declined from the previous week to 11.8 percent of total applications.
Despite the small drop in the 30-year fixed rate, mortgage rates are significantly higher than last year and continue to challenge buyers and the housing market overall.
"Apart from the ARM loan rate, rates for all other loan types were more than three percentage points higher than they were a year ago,"
"These elevated rates continue to put pressure on both purchase and refinance activity and have added to the ongoing affordability challenges impacting the broader housing market, as seen in the deteriorating trends in housing starts and home sales," Kan added.
Meanwhile, the share of refinance activity stayed low as homeowners remained hesitant to risk losing their low rates.
"With most homeowners locked into significantly lower rates, refinance applications continued to run more than 80 percent below last year's pace, while the refinance share of applications was 28.6 percent — the fifth straight week below 30 percent," Kan said.
The drop in mortgage rates follows months of steady increases fueled by the
Overall, the Fed's fight with inflation has led to a dramatic cooling of the once red-hot housing market.
Surging rates in recent weeks have led to record home price deceleration and plummeting pending sales. The number of homes under contract fell for the fourth consecutive month in September, declining by 10.2 percent from August, according to data from the
And NAR chief economist
"The new normal for mortgage rates could be around 7% for a while," Yun said in a statement last week.
"On a
5 key takeaways from the Federal Reserve's rate hikes
AFL-CIO bashes Federal Reserve over rate hike
Advisor News
Annuity News
Health/Employee Benefits News
Life Insurance News