According to the Mortgage Bankers Association’s Weekly Applications Survey, average mortgage rates fell to yet another new survey low last week. The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances fell to 3.91 percent from 3.93 percent the week before. Despite the drop, mortgage loan demand was relatively flat. The Refinance Index dropped 1.5 percent from the previous week and the Purchase Index slipped 0.6 percent. The Market Composite Index, which measures total mortgage loan application volume, fell 1.3 percent from the week before. The refinance share of all mortgage activity was unchanged at 76.6 percent. More here and here.
According to Freddie Mac’s most recent U.S. Economic and Housing Market Outlook, first-quarter economic data contains many encouraging signs for the general economy and housing market. Early estimates say the economy grew at 2.2 percent during the first quarter, which is slower than the previous quarter but an improvement over three of the past four quarters. Residential fixed investment, which reflects new housing construction and remodeling expenses, has grown in each of the past four quarters. Also, home prices have bottomed in many markets and, along with the lowest mortgage rates in more than 60 years, contribute to extraordinary affordability conditions for buyers. Frank Nothaft, Freddie Mac’s vice president and chief economist, said the first-quarter data is not uniformly positive but shows the macroeconomy and housing recovery are headed in the right direction. More here and here.
The Federal Housing Finance Agency’s home price index posted its first year-over-year improvement since 2007 in a report that also included quarterly and monthly gains. According to the index, which is calculated using sales price data from Fannie Mae and Freddie Mac mortgages, home values rose 0.5 percent from the first quarter of 2011 to the first quarter of this year. Prices also showed a quarterly increase of 0.6 percent and a 1.8 percent jump between March and April. Andrew Leventis, FHFA’s principal economist, said increased affordability and decreasing inventory are positively impacting home prices and the data is consistent with other housing market indicators showing stronger prices in the first quarter. More here and here.
The U.S. Department of Housing and Urban Development and the U.S. Department of Commerce released their New Residential Sales report for April. According to the report, sales of new single-family homes rose 3.3 percent over March’s revised rate and are 9.9 percent above year-before levels. The gains put new-home sales at a seasonally adjusted annual rate of 343,000, up from March’s revised rate of 332,000. The median sales price of new homes sold in April was $235,700; the average was $282,600. At the current sales pace, there was a 5.1-month supply of new homes available for sale at the end of the month. More here and here.
According to the Mortgage Bankers Association’s Weekly Applications Survey, refinance activity spiked 5.6 percent last week, as average mortgage rates hit another new low. The Increase in refinance application demand pushed total mortgage loan application volume up 3.8 percent over the previous week. It was the third straight week of gains in the Refinance Index and brought the refinance share of total mortgage activity up to 76.6 percent from 74.9 percent the week before. Michael Fratantoni, MBA’s vice president of research and economics, said mortgage rates dipped to new survey lows and spurred borrowers back into the refinance market. The average contract interest rate for 30-year fixed-rate mortgages fell to 3.93 percent from 3.96 percent the previous week. More here and here.