The Housing Market Hits Pause: What's Up with Mortgage Rates?

You might be wondering what's happening in the housing market lately. Well, mortgage rates have been on the rise, and it seems like everyone is taking a moment to think about what this means. Last week, mortgage rates jumped to their highest point since July. This increase happened as investors started to think about what a Trump presidency could mean for the economy. The Mortgage Bankers Association's index showed that the total application volume barely moved, going up by just 0. 5%. However, this small increase was the first rise in demand in seven weeks. The average interest rate for 30-year fixed-rate mortgages with loan balances of $766, 550 or less climbed to 6. 86% from 6. 81%. While that might not sound like much, even small changes can make a big difference. Joel Kan, the deputy chief economist at the Mortgage Bankers Association, said that this increase was driven by higher Treasury yields. It seems that financial markets are still trying to figure out what a Trump presidency might mean for the future.Things got interesting with refinance applications. They dropped by 2% last week, hitting their lowest point since May. But compared to the same week last year, they were still 43% higher. Last year at this time, mortgage rates were higher by 75 basis points. So, even though rates are up now, they're still lower than they were a year ago. Buying a home was a different story. Applications for purchase mortgages went up by 2% for the week and were 1% higher than the same week last year. Homebuyers might be seeing lower rates than last year, but they're also dealing with higher home prices. And the supply of homes for sale is still pretty low. Kan pointed out that loans backed by the Federal Housing Administration and the U. S. Department of Veterans Affairs helped boost purchase activity. FHA mortgage rates even went against the trend and were lower for the week, which likely helped some borrowers. Conventional purchase applications also saw a slight increase. Mortgage rates kept climbing on Tuesday. The bond market was closed on Monday for Veterans Day. Matthew Graham, the chief operating officer at Mortgage News Daily, wrote that the market is still dealing with election-related volatility. This involves a lot of different factors, from expectations about fiscal policy changes to traders adjusting their positions.