Real Estate & Area News

Mortgage Apps Slide for 2nd Straight Week

The Mortgage Bankers Association reported Wednesday that demand for home loans slipped last week as applications slowed down for both refinance and purchase loans. The group's seasonally adjusted index of mortgage applications fell 1.8 percent overall, primarily from a decline in refinance activity. The group also revised its index from the prior week, which had initially showed a 7 percent decline in mortgage apps in the week ended November 1st, to show a smaller decline of 2.8 percent. The adjustment affected both categories, as an initial report of a 7.9 percent dip in refinancing demand was revised to show a 3.9 percent slide, and the purchase index was revised from a fall of 5.2 percent to just 0.5 percent.

In the week ended November 8th, the MBA's report showed, the refinancing index fell off by 2.3 percent, while the purchase loan index slid 0.5 percent. The declines come as market insiders are keeping a close eye on the Federal Reserve, whose $85 billion a month bond buying program has been lifting the housing market for well over a year now. A number of extremely positive economic indicators have surfaced in recent weeks, fueling speculation that the Fed might begin unwinding the program earlier than 2014, which most observers have assumed would mark the onset of tapering the bond buying. Mortgage rates, while still quite low in historical terms, have risen dramatically in recent weeks on speculation about tapering, and economists believe that they will begin to rise faster once bond purchases are scaled back.

November 14, 2013