Editor’s Note: The Mortgage Mix is RISMedia’s weekly highlight reel of need-to-know mortgage-industry happenings. Watch for it each Friday afternoon.
Mortgage rates
The 30-year fixed-rate mortgage (FRM) averaged 7.12% this week, down slightly from last week’s 7.18%, according to the latest Primary Mortgage Market Survey® (PMMS®) from Freddie Mac released Thursday. The 15-year fixed-rate mortgage averaged 6.52%, down from 6.55% last week.
“For the fourth consecutive week, the 30-year fixed-rate mortgage hovered above seven percent,” said Sam Khater, Freddie Mac’s chief economist. “The economy remains buoyant, which is encouraging for consumers. Though while inflation has decelerated, firmer economic data have put upward pressure on mortgage rates which, in the face of affordability challenges, are straining potential homebuyers.”
“The Freddie Mac fixed rate for a 30-year mortgage notched a second week of decline, falling 6 basis points to 7.12%, as a holiday shortened week offers a smaller number of data points to shift expectations on both the economy and recent price trends. Taking a step back, the big picture remains largely unchanged, and the 30-year fixed mortgage rate has topped 7% for a 4th week in a row. The economy continues to chug along but the pace is likely slowing, a change that is needed to help move inflation back to the 2 percent target. In addition to fewer job openings and slower hiring this summer, recent readings on inflation have shown progress,” said Realtor.com Chief Economist Danielle Hale. “Anecdotal evidence in the Fed’s Beige book aligns with the data pointing to slower growth and hiring as well as easing price pressures. Despite some upticks in the market for new homes, home sales activity overall remains relatively low. And although home price momentum picked up in August and has continued into early September, rent prices have trended lower, which will likely help move inflation back toward its target in the months ahead. Looking ahead, the economy is nearing an inflection point, and mortgage rate volatility may continue until it is clear that the economic landing has actually occurred and we are not seeing a touch-and-go on growth that could reignite inflation.”
Mortgage applications
Mortgage applications dropped this week, decreasing 2.9%, according to the latest Weekly Applications Survey from the Mortgage Bankers Association (MBA).
“Mortgage applications declined to the lowest level since December 1996, despite a drop in mortgage rates,” said Joel Kan, MBA vice president and deputy chief economist. “The 30-year fixed mortgage rate decreased to 7.21% last week, but rates remained more than a full percentage point higher than a year ago, despite mixed data on the health of the economy and signs of a cooling job market.”
