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Recent Rate Dip Spurs Refinances and Purchases

Updated: Mar 21

low interest rate

The real estate market is showing promising signs of vitality, with recent data indicating a notable uptick in mortgage demand. Last week, mortgage rates experienced a slight decrease, prompting a significant 7.1% rise in total application volume, as reported by the Mortgage Bankers Association. This marks the second consecutive week of increased mortgage demand, reflecting a growing optimism among prospective homeowners and investors.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances dipped to 6.84% from 7.02%, making homeownership slightly more accessible for many. This reduction in rates, combined with lower points required upfront, is a welcome change for those looking to secure financing for a new home. According to Mike Fratantoni, the MBA's senior vice president and chief economist, this shift is partly due to recent economic data pointing towards a weaker service sector and adjustments in the job market, including a rise in unemployment rates.

Refinancing activity, particularly sensitive to fluctuations in mortgage rates, saw a 12% increase last week, outperforming the same period last year by 5%. This resurgence in refinancing suggests that many are seizing the opportunity to lock in lower rates, especially those who had previously secured loans when rates were nearing their peak. On the other hand, applications for new home purchases also grew by 5%, albeit still trailing behind last year's figures by 11%. This discrepancy highlights the challenges buyers face, such as elevated home prices and limited inventory, despite the seasonal influx of properties in the spring.

As we move forward, the real estate market remains dynamic, with mortgage rates experiencing a minor increase following recent consumer price reports. However, the restrained reaction to this data suggests a market increasingly optimistic about future economic conditions potentially favoring lower rates.

For those navigating the complexities of the real estate and mortgage landscape, these developments underscore the importance of staying informed and agile. Whether you're considering buying a new home, refinancing your current mortgage, or simply exploring your options, We're here to help. Reach out to engage in a discussion about how these trends might impact your real estate decisions and how we can strategize to meet your needs in this ever-evolving market.

If you'd like to review your current debt position to see if there is a savings opportunity by doing a debt consolidation refinance, give us a call at 707-203-8600. Even if your current rate is quite low, you may find that consolidating your debts into a new mortgage may create a significant savings. Call us, or fill out the "Contact Us" form below, and we'll conduct a professional, transparent review for you so you can make an informed decision.

Call us at 707-203-8600 - We're here to help!

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