Mortgage services.

In this week's update on mortgage applications from the Mortgage Bankers Association (MBA), purchases continued a modest retreat but refinance demand improved for the 2nd week in a row. This was just barely enough for the Refi index to hit the highest levels since October 2024. The uptick makes sense in light of the mortgage rate situation last week.  Rates had been inching slowly to the lowest levels in almost 2 months as of Monday morning. Wednesday brought a a noticeable drop and there wasn't much of a bounce for the rest of the week. As has been and continues to be the case, all of the volatility seen in the past year represents only a fraction of the longer-term range. Here's the same refi index over a longer time frame. The purchase side of the market is typically never as responsive to rates in the short term, and last week was no exception. MBA's purchase app index moved down for the 3rd week in a row, although it's still closer to the top of the recent range. In the bigger picture, purchase applications suffer from the same jarring adjustment experienced across the housing market with the epic rate spike in 2022. Here's a breakdown of this week versus last week in several categories of loans in terms of market share: Refinances 40.2 vs 39.0 FHA Loans 16.0 vs 16.2 VA Loans 14.6 vs 13.3 Survey respondents had 30yr fixed rates at 6.95 with 0.64 points, down slightly from 6.97 in the previous week.  Jumbo loans were down to 6.96 from 7.01 and ARM rates moved up to 6.20 from 6.07.

There are two main styles of measurement when it comes to keeping track of mortgage rates: daily and weekly.  Sometimes, the differences in methodologies mean that two reputable sources can convey seemingly incongruent conclusions.  Other times, both the granular and general data agree.  This is one of those times. Whether we're looking at MND's daily averages or MBA's weekly survey, mortgage rates hit their lowest levels in 6 weeks by the end of last week.  The drop wasn't immense, but based on today's release of MBA application data, it was enough for a small bump in refinance demand.  As is constantly the case over the past several months, the scope of the mid-2024 spike in application activity is more easily understood with the benefit of additional historical context. Purchase applications are never as sensitive to rates over short time horizons.  In fact, they moved down a bit last week, but the counterpoint is that the purchase index has been holding near recent highs. Here too, broader context changes the takeaway. Other details from the report: Refinances accounted for 39% of the total vs 37.1% last time FHA loans accounted for 16.2%, down a bit from 16.7% VA loans accounted for 13.3% vs 13.2% MBA recorded 30yr fixed rates at 6.97 for the week with 0.64 discount points Jumbo rates were 7.01 with 0.48 discount points

The National Association of Realtors (NAR) released its Pending Home Sales Index (PHSI) for December this morning.  Pending sales measures the number signed purchase contracts for existing homes. As such, the index is a good early indicator for Existing Home Sales in the coming month. Pending sales dropped 5.5% from last month, which was the highest level for the index since April 2023. Sales had also been on a 4 month winning streak.  In other words, sales activity remains in solid territory, in the upper middle portion of the range over the past year.  As is the case with most housing-related metrics, that range is at historically low levels.  Regional breakdown of monthly and (year-over-year changes): Northeast  -8.1% (-1.3%) Midwest -4.9% (-6.9%) South -2.7% (-5.1%) West -10.3% (-5.1%)