According to the Mortgage Bankers Association’s Weekly Applications Survey, average mortgage rates fell across all loan categories last week. Rates were down from one week earlier for 30-year fixed-rate loans with both conforming and jumbo balances, loans backed by the Federal Housing Administration, and 15-year fixed-rate loans. It was the second consecutive week mortgage rates declined. But though rates fell, it didn’t lead to an increase in demand for loans to buy homes. In fact, the MBA’s purchase index was unchanged from one week earlier. Joel Kan, MBA’s associate vice president of economic and industry forecasting, says higher rates, prices, and low inventory are suppressing demand. “The 30-year fixed rate declined for the second straight week … but remains well above what borrowers were used to over the past two years,” Kan said. “Currently, higher rates, low inventory, and high prices are keeping prospective buyers out of the market.” The MBA’s weekly survey has been conducted since 1990 and covers 75 percent of all retail residential mortgage applications. (source)
