Mortgage demand surges at start of new year even as interest rates rise
FOX Business correspondent Madison Alworth shares why for many first-time homebuyers, the American dream is delayed as a result of high mortgage rates and home prices on 'Varney and Co.'
A key measure of home-purchase applications surged at the start of the new year despite a slight uptick in mortgage rates.
The Mortgage Bankers Association's (MBA's) index of mortgage applications rose 9.9% for the week ended Jan. 5, compared with one week earlier, according to new data published Wednesday.
The data also showed that the average rate on the popular 30-year loan started the year at 6.81%. While that is down from a peak of 8% in October, it is slightly higher than it was the previous week.
«Despite an uptick in mortgage rates to start 2024, applications increased after adjusting for the holiday,» said Joel Kan, MBA's deputy chief economist.
CREDIT CARD DEBT RISING IN DOUBLE-EDGED SWORD FOR THE ECONOMY
Available home supply remains down a stunning 45.1% from the typical amount before the COVID-19 pandemic began in early 2020, according to a recent report from Realtor.com. (David Paul Morris/Bloomberg via / Getty Images)
Housing demand stirred back to life after dropping at the end of December, even with the recent rise in rates. Applications for a mortgage to purchase a home climbed 6% from one week earlier. Application volume is down 16% compared with the same time last year.
Demand for refinancing also moved higher last week, jumping 19% from the previous two weeks, according to the survey. Compared with the same time last year, refinance applications are up about 30%.
«The increase in purchase and refinance applications for both conventional and government loans is promising to start the year but was likely due to
Read more on foxbusiness.com
