Mortgage applications in US surge following decline for 4th consecutive week
Date
8/29/2024 4:58:12 AM
(MENAFN) According to a report released by the Mortgage Bankers Association (MBA) on Wednesday, US mortgage applications saw an increase last week, following a decline in rates for the fourth consecutive week. The market composite index, which measures the volume of mortgage loan applications, rose by 0.5 percent on a seasonally adjusted basis for the week ending August 23. However, on an unadjusted basis, the index fell by 1 percent compared to the previous week, reflecting a mixed picture of mortgage activity.
Joel Kan, MBA’s vice president and deputy chief economist, noted that the slight increase in mortgage applications was driven by a marginally stronger performance in purchase activity. Despite the recent trend of lower interest rates, Kan observed that purchase applications have remained relatively stagnant. This stability suggests that prospective homebuyers are exercising patience, waiting for further rate reductions and an increase in the inventory of homes available for sale.
The average contract interest rate for 30-year fixed-rate mortgages decreased to 6.44 percent, marking the fourth consecutive weekly decline and reaching its lowest level since April 2023. This is down from 6.5 percent the previous week. Similarly, the average rate for 15-year fixed-rate mortgages fell to 5.88 percent from 6.04 percent during the same period, indicating a continued trend of lower borrowing costs.
The MBA survey, which includes more than 75 percent of US retail residential mortgage applications, highlights the ongoing adjustments in the mortgage market. The data reflects the impact of fluctuating interest rates on application volumes and underscores the current cautious approach of homebuyers amid evolving market conditions.
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