Freddie Mac reports its Primary Mortgage Market Survey shows the 30-year fixed-rate mortgage (FRM) averaged 6.95% this week, the same as the previous week. For homebuyers, affordability didn’t get any better but at least it didn’t get worse.
"The 30-year fixed-rate has hovered between 6% and 7% for most of the last two and a half years, Sam Khater, Freddie Mac’s chief economist, said in a statement. “That trend continued this week, with the average rate remaining essentially flat at 6.95%. Driven by these higher rates and a persistent supply shortage, affordability hurdles still exist for many homebuyers and a significant number of them remain on the sidelines.”
That was evident in the latest update from the Mortgage Bankers Association, which reported that new mortgage applications plunged 2% from the week before
The Market Composite Index, a measure of mortgage loan application volume, decreased 2% on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index fell 9% compared with the previous week.
With rates at this level, very few current homeowners are refinancing. The Refinance Index declined by 7% from the previous week and was 5% higher than the same week one year ago. The seasonally adjusted Purchase Index decreased 0.4 percent from one week earlier. The unadjusted Purchase Index decreased 4 percent compared with the previous week and was 7 percent lower than the same week one year ago.
MBA and Freddie Mac track mortgage rates in different ways and often come up with different results. Joel Kan, MBA’s deputy chief economist, says the average 30-year mortgage rate was 7.02% for the week ending Jan. 24.
Mortgage rates are linked to the yield on the 10-year Treasury bond, which has held steady over the last few months.