Cinq Mortgage

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At Cinq Mortgage we deliver the absolute best lending experience through knowledge, communication and care. Our mission supports the growth and strength of our communities and provides a pathway to the dream of home ownership.

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Big Bounce in Refi Demand Thanks to Lower Rates

March 07 2025

As we noted last week, the timing of the improvements in mortgage rates meant that the previous survey of mortgage applications from the MBA was unable to capture what would likely prove to be a fairly big uptick in refinance demand.  This week's data confirmed it as the refi index jumped to the best levels since October.  Unsurprisingly, this coincided with rate moving back to the range seen in mid-October, although it is somewhat surprising that we didn't see a better spike in refi demand in early December when rates were in the same zone. As has been and continues to be the case, we're taking victories where we find them. Refi demand is operating on an entirely different scale than in the past (when a rate rally meant that far more homeowners would benefit from refinancing). Purchase demand is always less influenced by short term rate fluctuations. This week was no exception with MBA's purchase holding almost perfectly steady and continuing to operate in the same broadly sideways range that's been intact for 2 years.

Why Didn't Refi Demand Spike This Week?

February 28 2025

As is the case almost every week of the year, the Mortgage Bankers Association released its weekly mortgage app survey this week, showing the changes in purchase and refinance applications. We can skip right past any discussion or analysis of the purchase application index as it was almost identical to last week, not to mention reluctant to be influenced by interest rate movement in the first place. Refinance demand, on the other hand, is notoriously beholden to rate fluctuations.  As such, it was somewhat surprising to see the refi index  decline by about 3.6%. After all, last week's mortgage rates were lower than the previous week's, and continued to fall throughout the week. While it's true that rates were lower last week, it's important to remember MBA's methodology.  Application data is collected through the previous Friday and then reported on the following Wednesday. Mortgage rates only began moving lower in any serious way on Thursday.  That means the survey didn't have much time to benefit from the rate drop this time around.   Given the pace of rate improvement since then, it would be a much bigger surprise to see another counterintuitive movement in next week's data.  If precedent is an indication, refi demand could once again challenge the best levels since October 2024.

New Home Sales Drop 10.5%. Should You Care?

February 28 2025

The Census Bureau released new home sales data for January this week, and the annual pace was a seemingly significant 10.5% lower than last month's pace.  But before you devote even one extra BPM of your heart rate to the news, please look at a longer-term chart of the data in question. Home sales are indeed lower versus last month, but caveats abound.  First off, last month was revised up from 698k to 734k (annual pace). January's 657k is only 5.9% lower from the unrevised number.  It's also good to keep in mind that this data has a notoriously wide margin of error (±19.9 percent in the present case, according to the Census Bureau).  But even if the data was completely error free, the chart continues to tell a story that is far from troubling, even if it's not grounds for unabashed excitement. Simply put, new homes continue to sell at a pace that's very close to recent highs (excluding the frenzied moments from 2020 through early 2022). Current levels are also on the higher end of the pre covid range going back to 2016. Bottom line, much like home price appreciation, new home sales have been sideways and boring at relatively strong levels. Full release available from Census Bureau here: https://www.census.gov/construction/nrs/pdf/newressales.pdf

CINQ HOLDINGS INC dba CINQ MORTGAGE
NMLS # 2073815
ALEXANDER MUTUC
NMLS # 1996425
6 San Nicholas
Rancho Santa Margarita CA 92688
949-229-1213
Cinq Mortgage
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Copyright ©2020 Cinq Holdings Inc., dba Cinq Mortgage. Licensed by the California Department of Real Estate, DRE# 01788664 / CO. DRE# 02124821. NMLS# 1996425 / CO. NMLS# 2073815. 6 San Nicholas Rancho Santa Margarita, CA 92688 (949) 229-1213. All rights reserved. This is not an offer to enter into an agreement. Not all customers will qualify. Information, rates and programs are subject to change without notice. All products are subject to credit and property approval. Other restrictions and limitations may apply.