Mortgage Prices

Requests to buy a home dropped 2 per cent for the week, and were also 2 per cent lower than a year ago. Rising prices are weakening mortgage demands. According to a CoreLogic survey, house prices in June were up 6.8 per cent on the previous year. "In spite of recent figures pointing to a buoyant US economy and a buoyant labour force, for the third consecutive week mortgage application levels dropped, despite recent indications of salary increases, as residential construction continued to be hindered by the shortage of available houses and low affordability," said Joel Kan, MBA VP of Economics and industry forecast.

The number of mortgage requests to re-finance a home loans is declining, and they continue the downtrend, plunging by 5 per cent on the preceding month to their low since December 2000. This is 35 per cent less than in the year before. Refinancing of mortgage activities also fell from 37.1 per cent in the preceding weeks to 36.6 per cent of overall mortgage-applicants.

Floating interest mortgage rates accounted for 6.3 per cent of overall mortgage application volume. Mean interest rates on 30-year fixed-rate mortgage contracts with compliant credit balance (USD 453,100 or less) stayed stable at 4.84 per cent, while points on 20 per cent advance credit stayed stable at 0.45 per cent. Looking at mortgage application as a whole, the outlook was gloomy.

"This market index, which tracks both buy and refinancing requests, was lowered to its low since January 2016. Buy and refinancing indices both fell this weekend as well, with the refinancing index remaining near its low since December 2000," said Mr. Kan. However, the index is expected to remain at its low for the year.