Mortgage interest rates fell for the third straight week, bringing rates to their lowest level since September. As rates drop, mortgage applications are beginning to roll in after a lull in the market.
The average 30-year fixed mortgage rate fell to 6.46% from 6.56% last week, according to Bankrate.com. Meanwhile, applications to refinance a home loan rose 15% from last week, CNBC reported. Although the uptick is significant, it’s still 77% lower than it was the same week a year ago. Rates are now the lowest they have been since September, but those rates were at new highs, causing mortgage applications to drop at the time.
In 2022, the housing market experienced new levels of demand and competition, causing home prices across the country to soar and pricing out millions of would-be buyers. However, as interest rates fall and certain markets begin to cool, buyers could begin swooping in for the price drops they have been anticipating.
“Homebuying activity remains tepid, but if rates continue to fall and home prices cool further, we expect to see potential buyers come back into the market,” Joel Kan, an MBA economist, told CNBC. “Many have been waiting for affordability challenges to subside.”