Blaine, Minnesota is offering brand new townhomes for sale, featuring new construction financing and a builders credit of $4,500 to attract prospective buyers.
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Last week, mortgage interest rates experienced a slight decline after a significant surge at the beginning of July. While this stimulated a surge in demand for refinancing, it did not offer much relief for potential homebuyers.
According to the Mortgage Bankers Association’s seasonally adjusted index, the total volume of mortgage applications increased by 1.1% compared to the previous week.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($726,200 or less) decreased to 6.87% from 7.07%, along with a decrease in points from 0.74 to 0.66 (including the origination fee) for loans with a 20% down payment. In the same week last year, the rate stood at 5.82%.
“Mortgage rates declined last week, as markets responded positively to incoming data showing that U.S. inflation continues to cool,” stated Joel Kan, an economist at the MBA.
The lower rates prompted existing homeowners to reach out to their lenders for refinancing. Refinance applications increased by 7% for the week, although they remained 32% lower compared to the same period last year. The refinance share of mortgage activity rose to 28.4% of total applications from 26.8% the previous week.
However, applications for mortgages to purchase homes declined by 1% for the week and were 21% lower than the corresponding week in 2022. The weak homebuying trend is compounded by diminishing supply and increasing home prices. After a period of moderation last year, prices are now rising again due to low supply and persistent demand.
As the new week begins, mortgage rates have remained relatively stable, lingering in the high 6% range for 30-year fixed-rate mortgages. Investors and markets are currently analyzing quarterly earnings reports and attempting to predict the actions of the Federal Reserve.
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