The refinance index rose 5% compared to the previous week, standing 18% higher than the same week last year. The refinance share of mortgage applications increased to 41.5%, its highest since April. Mortgage rates fell due to decreasing Treasury yields amid a weakening U.S. economy, with the 30-year fixed rate dropping to 6.77%. Both refinance and purchase applications rose, influenced by lower rates and increased home inventory. The adjustable-rate mortgage share grew while FHA and USDA shares fluctuated. Average interest rates decreased across multiple mortgage products.
The refinance index increased 5% from the previous week and was 18% higher than the same week one year ago. The refinance share of mortgage activity increased to 41.5% of total applications from 40.7% last week. Refinance applications increased to their strongest pace in four weeks after being on a downward trend the prior three weeks.
Mortgage rates moved lower last week, following declining Treasury yields as economic data releases signaled a weakening U.S. economy. As a result, the 30-year fixed rate decreased for the third straight week to 6.77%.
Borrowers sought to take advantage of these lower rates, as both purchase and refinance applications increased over the week. Purchase activity continued to lead 2024's pace, increasing for-sale inventory of homes supporting homebuying.
Average contract interest rates decreased across the board. Interest rates for jumbo loans decreased to 6.65% from 6.74% and 30-year fixed-rate mortgages backed by the FHA decreased to 6.47% from 6.56%.
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