Mortgage rates have fallen to their lowest level in over a month, sparking a surge in demand from homebuyers. According to the Mortgage Bankers Association, applications to purchase a home jumped 6% for the week, marking the highest level since January.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances decreased to 6.69%, down from 6.86%. This is the lowest rate in more than a month and has prompted potential homebuyers to take advantage of the lower rates and higher supply of homes for sale.
Refinance applications, however, fell 1% for the week and were 7% lower than the same week one year ago. This decrease is attributed to the fact that most borrowers have loans with far lower rates than are being offered today.
Economists attribute the recent surge in purchase activity to lower mortgage rates and higher inventory levels, which provide prospective buyers with more options compared to earlier in the year. The Mortgage Bankers Association’s seasonally adjusted index shows total mortgage application volume rose 2.8% compared to the previous week.
Source: https://www.cnbc.com/2024/12/04/homebuyer-demand-for-mortgages-jumped-6percent-as-interest-rates-fell-to-the-lowest-level-in-over-a-month.html