The numbers: U.S. mortgage applications inched up in the latest week as some buyers waded back into the process of buying a home.
Home-buying demand didn’t fizzle out in the face of rising rates. The overall market composite index — a measure of mortgage application volume — increased in the last week, according to the Mortgage Bankers Association (MBA) said on Wednesday.
The market index rose 3.7% to 218.2 for the week ending January 19 from a week ago. A year ago, the index stood at 256.0.
Key details: The purchase index — which measures mortgage applications for the purchase of a home — rose 7.5% from a week ago.
The refinance index fell 7%, as homeowners saw little incentive to do so.
The average contract rate for the 30-year mortgage for homes sold for $726,200 or less was 6.78% for the week ending January 19. That’s up from 6.75% from the week before.
The rate for jumbo loans, or the 30-year mortgage for homes sold for over $726,200, was 6.94%, up from 6.86% the previous week.
The average rate for a 30-year mortgage backed by the Federal Housing Administration was up to 6.51% from 6.46%.
The 15-year rose to 6.31% from 6.24% from the previous week.
The rate for adjustable-rate mortgages rose to 6.22% from last week’s 6.14%.
The big picture: Mortgage rates are bouncing around, but the broader trend indicates that home-buying interest is increasing. But with lower-than-normal inventory, applications and sales will likely be muted. Refinancing remains unattractive as many homeowners have mortgage rates lower than the current level.
What the MBA said: “Conventional and FHA purchase applications drove most of the increase last week as some buyers moved to act early this season,” Joel Kan, vice president and deputy chief economist at the MBA, said in a statement.
Market reaction: The yield on the 10-year Treasury note
BX:TMUBMUSD10Y
was over 4% in early morning trading Wednesday.
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