Monday

 

Mortgage applications fall

U.S. mortgage applications fell last week as interest rates climbed to 17-month highs and demand for refinancings slid to their lowest level this year.

The Mortgage Bankers Association said its index of mortgage application activity for the week ended November 11 slid 0.6 percent to 657.6.

Borrowing costs on 30-year fixed-rate mortgages, excluding fees, averaged 6.33 percent last week, up 0.02 percentage point from the previous week. It was highest level since the week ended June 11, 2004 when the rate reached 6.34 percent.

In 2005, the fixed 30-year mortgage rate, the industry benchmark, has been climbing on and off from its low this year in late June at 5.47 percent.

The group's index of refinancing applications dropped 5.4 percent to 1,702.4, its lowest since the week ending December 31, 2004.

The MBA's purchase mortgage index, considered a timely gauge of U.S. home sales, rose 2.6 percent to 477.9.

Even though home purchase applications rose for a second consecutive week, they still were below their year-ago level, when the 30-year mortgage interest rate stood at 5.70 percent, substantially below current levels, MBA figures showed. The indexes were all seasonally adjusted.

Fixed 15-year mortgage rates averaged 5.87 percent, up from 5.85 percent the previous week. Rates on one-year adjustable-rate mortgages (ARMs) increased to 5.46 percent from 5.45 percent.

# posted by Reloblog Admin @ 2:10 AM

Saturday

 

Housing starts seen lower

U.S. housing starts should drop in October as rising mortgage rates and lower purchasing activity suppressed market activity, economists said.

U.S. housing starts fell in October to 2.070 million units from 2.108 million in September, according to the median forecast in a Reuters poll of 36 economists.

Permits, a sign of confidence among homebuilders, are also seen dipping to 2.160 million units in October from the prior month's 2.219 million.

Mortgage finance company, Freddie Mac said interest rates on U.S. 30-year mortgages, the industry benchmark, averaged 6.07 percent in October, up from 5.77 percent in September. Rates on 15-year mortgages averaged 5.63 percent, up from September's 5.36 percent.

Analysts say higher interest rates may have finally cooled the U.S. housing sector. Evidence of lower loan demand, slower home price appreciation and growing inventory in recent months has many observers declaring a slowdown has finally arrived.


# posted by Reloblog Admin @ 5:36 PM

Monday

 

Mortgage rates climbing loan applications fall

Mortgage update

The average rate for 30-year mortgages rose to 6.31% this week, the highest rate in 16 months, disclosed by mortgage giant Freddie Mac. A year ago, the average rate was 5.7%.

Adjustable-rate mortgages also jumped. The average rate for a 1-year ARM was 5.09% this week, highest since 5.11% in March 2002. Rates on 5-year hybrid ARMs rose to 5.76%, up from 5.03% at the beginning of the year.

Adjustable-rate mortgages helped fuel the housing bonanza by making home loans more affordable, and there are signs that higher rates are putting a brake on sales. On Wednesday, the Mortgage Bankers Association reported that mortgage applications fell 4.8% last week from the previous week, on a seasonally adjusted basis. Mortgage applications were down 15.2% from a year ago.

Adjustable rates have been rising faster than fixed rates all year. When that happens, you lose the advantage of ARMs, and it decreases affordability, according to chief economist for the MBA.

Adjustable rates are tied to short-term interest rates, which are controlled by the Federal Reserve Board.

On Tuesday, the Fed raised short-term rates a quarter-point to the highest level in four years and signaled that more rate increases are coming.
Adjustable-rate mortgages accounted for 29.4% of mortgage applications last week, down from nearly 33% in January, the MBA says.

Fixed-rate mortgages, meanwhile, are linked to rates for 10-year Treasury notes, which have moved higher on inflation jitters. Inflation anxiety was stoked last week by reports that the economy grew faster than expected during the third quarter, says chief economist for Freddie Mac. Bond investors also are worried about higher energy costs. Natural gas prices are already at record levels and could go even higher. That has fueled the fear that inflation will be higher going forward.

# posted by Reloblog Admin @ 11:26 PM

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