Tags: Mortgage | Applications | Rates | Home | Loan | Housing

Mortgage Applications Fall 3.4 Percent Amid Sparse House Selection

Mortgage Applications Fall 3.4 Percent Amid Sparse House Selection
(iStock)

By    |   Wednesday, 31 May 2017 12:13 PM

Mortgage applications fell 3.4 percent last week as rates remained steady but the housing inventory stayed lean.

The Market Composite Index, a measure of mortgage loan application volume, decreased 3.4 percent on a seasonally adjusted basis from one week earlier,  according to data from the Mortgage Bankers Association's (MBA) Weekly Mortgage Applications Survey.

The Refinance Index decreased 6 percent from the previous week. The refinance share of mortgage activity decreased to 43.2 percent of total applications from 43.9 percent the previous week.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($424,100 or less) remained unchanged at 4.17 percent. The average contract interest rate for 15-year fixed-rate mortgages decreased to 3.42 percent from 3.45 percent.

"Home sales remain constrained by a lack of inventory across the country, as evidenced by home price growth running almost three times the pace of overall inflation," Michael Fratantoni, chief economist for the MBA, told CNBC.

To be sure, contracts to buy previously owned U.S. homes fell for a second straight month in April amid a supply squeeze, but the housing market recovery remains supported by a strong labor market.

The National Association of Realtors said on Wednesday its Pending Home Sales Index, based on contracts signed last month, dropped 1.3 percent to 109.8, Reuters reported.

Economists had forecast pending home sales rising 0.5 percent last month. Pending home sales fell 3.3 percent from a year ago. That is the first year-on-year drop since last December and the largest since June 2014.

"Much of the country for the second straight month saw a pullback in pending sales as the rate of new listings continues to lag the quicker pace of homes coming off the market," said NAR chief economist Lawrence Yun. "Realtors are indicating that foot traffic is higher than a year ago."

Pending home contracts become sales after a month or two, and last month's fall suggested a further decline in home resales after they dropped 2.3 percent in April.

Demand for housing is being driven by a tight labor market, marked by a 4.4 percent unemployment rate, which is generating wage increases and boosting employment opportunities for young Americans.

(Newsmax wire services contributed to this report).

Related Stories:

© 2020 Newsmax Finance. All rights reserved.


   
1Like our page
2Share
Personal-Finance
Mortgage applications fell 3.4 percent last week as rates remained steady but the housing inventory stayed lean.
Mortgage, Applications, Rates, Home, Loan, Housing
368
2017-13-31
Wednesday, 31 May 2017 12:13 PM
Newsmax Media, Inc.
 
Newsmax TV Live

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

NEWSMAX.COM
MONEYNEWS.COM
© Newsmax Media, Inc.
All Rights Reserved