“The 30-year fixed rate fell to 6.55%, reaching its lowest level since May 2023, following doveish communication from the Federal Reserve and a weak jobs report, which added to increased concerns of an economy slowing more rapidly than expected,” said Joel Kan, MBA’s deputy chief economist.
The refinance index hit its highest level since September 2022, up 16% from the previous week as homeowners took advantage of lower interest rates.
“This brought refinance activity back to the highest level seen since September 2022, when mortgage rates began approaching 7% for the first time since 2002,” said Fannie Mae chief economist Doug Duncan (pictured). “If the recent drop in longer-term rates is sustained, then we expect to see another uptick in refinance applications and subsequent refinance mortgage volumes this week.”
Kan noted that refinance applications increased across all loan types, particularly for VA loans, and were almost 60% higher than it was at this time last year and were at their highest level in two years.
The refinance share of mortgage activity increased to 41.7% of total applications from 38.2% the previous week. The adjustable-rate mortgage (ARM) share of activity also rose, reaching 6.3% of total applications. The FHA share of total applications was up to 13.4%, VA share increased to 14.3%, while the USDA share of total applications dropped slightly to 0.4%.
Source: mpamag.com