Real Estate & Area News

Mortgage Demand Slides for 2nd Straight Week

Requests for home loans declined for a second straight week during the last week of October, according to a report issued Wednesday by the Mortgage Bankers Association. The group's Market Composite Index, which tallies applications for both purchase loans and refinancings, fell 2.6 percent on a seasonally adjusted basis in the week ended October 31st. The decline was fueled by a 6 percent slide in demand for refinancing loans, while the MBA's gauge of purchase demand rose 3 percent from the prior week. Of course, housing experts note that applications for new home loans typically slow way down this time of the year as parents get their kids back to school and families tighten up their purse strings in order to afford impending holiday expenses.

Of all applications for mortgages signed in the week ended October 31, 63 percent were requests to refinance existing loans. That's down from a 65 percent share in the week prior. 7.4 percent of all applications were for adjustable-rate mortgages, while the share of FHA loans rose from 8.9 percent to 9.5 percent. The decline in mortgage applications can at least partially be attributed to rising interest rates, as the average rate for a 30-year, fixed-rate mortgage edged up from 4.13 percent to 4.17 percent last week.

November 5, 2014