Mortgage Refinance Demand Plummets 21% as Interest Rates Reach 3-Week High

Mortgage Rate Surge and Refinance Drop

• 📈 The average rate for a 30-year fixed conforming mortgage increased to 6.46% last week, up from 6.34%.
• 📉 Consequently, applications to refinance a home loan dropped 21% compared to the previous week.
• ⚠️ This decline occurred despite rates being 32 basis points higher than the same week last year.
• 💰 The average loan size for refinances also decreased significantly due to higher rates, reducing the incentive for larger loans.

Home Purchase Applications Decline Slightly

• 🏠 Applications to purchase a home also fell, by 1% for the week.
• 📊 This follows three consecutive weeks of gains, but purchase applications remain 16% higher than a year ago.

Market Uncertainty and Economic Data

• 📊 Mortgage rates have remained stable at the start of the current week.
• ⏳ The market was anticipating potential rate movements following the monthly employment report, but a government shutdown has placed this data release in limbo.