Mortgage applications fall for fourth straight week despite lower rates
In another sign of a sluggish housing market, mortgage applications edged down last week despite lower borrowing costs.
Total mortgage applications fell a seasonally adjusted 1.9% from the prior week,the Mortgage Bankers Association (MBA) said Wednesday. It marked the fourth consecutive weekly drop.
Applications to refinance mortgages and buy homes both declined 2%. Yet purchase applications were still up 6% from the same period last year and refinances were up 81%.
The 30-year fixed rate slipped to 4.08% from 4.12%. Although rates are in line with the average of 4.1% for June, refinances were down 7% from last month.
"This is an indication that as we see rates lower for longer, borrowers more of a drop in rates to consider refinancing," says Joel Kan, MBA’s associate vice president of economic and industry forecasting.
Anticipated Federal Reserve rate cuts are also playing a role.
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“The Federal Reserve’s telegraphed intent to change tack and move forward with a rate cut (later this month) gave buyers another reason for pause,” says George Ratiu, economist for realtor.com, “as they expect mortgage rates to stay lower for a longer period.”