U.S. mortgage rates dip, home demand falls

Mortgage rates decreased for the first time in over two months, falling to 7.41% from 7.50% for 30‑year fixed‑rate mortgages (CNBC). The drop was 0.09 percentage points, and points fell to 0.75 from 0.83 including the origination fee for loans with a 20% down payment (CNBC).

Total mortgage application volume fell 5.3% last week compared with the previous week, according to the Mortgage Bankers Association’s seasonally adjusted index (CNBC). Both purchase and refinance applications continued to decline, according to the same release (CNBC).

Refinance applications fell just 2% week‑to‑week, a smaller drop than some previous weeks when rates were moving higher (CNBC). Refinance demand was still 59% lower than the same week a year ago, and rates are now over a full percentage point higher than a year ago (CNBC).

Purchase applications declined 7% for the week and were 18% lower from the year before, according to the Mortgage Bankers Association (CNBC). Buyers are reacting more to the overall higher level of rates than to the weekly move (CNBC).

Contract signings to purchase homes fell in September to the lowest level on record, as buyers fled the housing market in the wake of the average 30‑year mortgage rate crossing over 7% (MarketWatch). The decline in contract signings indicates a slowdown in the housing market (MarketWatch).