The Mortgage Bankers Association (MBA) today released its survey for the weeks ending December 25, 2009 and January 1, 2010. (There was no news release during the week of Christmas; so they released two weekly reports today.)
The average 30-year mortgage during the week ending December 25, 2009 was 5.08%, which was up 0.16% from the rate reported one week earlier. The average 15-year mortgage during the week ending December 25, 2009 was 4.57%, which increased 0.23%from the week earlier survey.
The average 30-year mortgage during the week ending January 1, 2010 was 5.18%, which was up 0.10% from the rate reported one week earlier. The average 15-year mortgage during the week ending January 1, 2010 was 4.62%, which increased 0.05%from the week earlier survey.
For the week ending December 25, 2009, seasonally adjusted refinance applications fell 30.5%, and purchase applications fell 4.0% from the prior week according to the survey.
For the week ending January 1, 2010, seasonally adjusted refinance applications fell 1.6%, and purchase applications rose 3.6% from the prior week according to the survey. The four-week moving averages were not provided in the news release.
The refinance share of applications fell to 68.2%. It had been 75.9% prior to Christmas. Refinance applications tend to be highly sensitive to interest rate levels.
The recent report leaves purchase applications roughly flat over the holiday period, but still 28.2% lower than the same period last year. This is not surprising given that the First-Time Home Buyer Tax Credit was only extended on November 6, 2009, at which time it was also expanded to cover some previous home owners. Nonetheless, we were expecting a fairly sharp drop off in purchase applications because we had expected that it would take several months for new buyers to get in gear to move forward with their home purchase plans.
After the holidays we will likely see more home buyers stepping up to the plate.
Although the rates are about 0.5% higher than the lows of several weeks ago, these low rates still continue to be encouraging for home purchases going forward. However, the idea of potential home buyers postponing purchases while waiting for better rates seems to be a bad bet at this point.
If they haven’t already made their move, any serious potential home buyer should be thinking about pulling the trigger very soon or risk missing the low rates entirely.
Follow the link to see the full release:
http://www.mbaa.org/NewsandMedia/PressCenter/71462.htm
