Mortgage rates plummet to 2-month low, reigniting housing demand
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 rose to the highest level in six weeks as a sharp drop in mortgage rates reignited demand among consumers.
The Mortgage Bankers Association's (MBA) index of mortgage applications rose 3% last week, compared with the previous week, according to new data published Wednesday. It marked the third straight week of gains.
The data also showed that the average rate on the popular 30-year loan tumbled to 7.41% – a notable drop from just four weeks ago, when rates hovered around 7.91%. It is the lowest level for mortgage rates in two months.
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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)
Separately, mortgage buyer Freddie Mac on Wednesday said that the average rate on a 30-year loan slid to 7.29%, down 0.15% from the previous week. The rate remains well above the pandemic-era lows of 3%.
The average rate on a 15-year mortgage – more popular among homeowners who choose to refinance – dropped to 6.67%.
The decline in rates helped to spur more housing demand, with applications for a mortgage to purchase a home also rising 4% for the week. Still, application volume remains down 20% compared with the same time last year.
Demand for refinancing also inched higher last week, rising 2% from the previous week, according to the survey. Compared with the same time last year,
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