Refinance Boom May Well Be Over
The Market has turned!
In the last six or seven weeks many of our leading economic indicators have shifted dramatically from positive to negative. The refinance boom may well be over.
FreddieMac's weekly interest rate survey pegged the average 30 year fixed rate mortgage at 6.14%, up from 5.93% the prior week. It has risen 93 basis points in just six weeks.
The Mortgage Bankers Association's weekly application survey reflected the impact of higher rates. The key indexes plunged:
* The Purchase Index fell 3.4% from 444 to 427
* The Refinance Index plummeted 33% from 6,181 to 4,146. It has fallen from the record level of 9,978 on June 5, to the current level of 4,146 - almost a 60% drop.
Title insurance companies have experienced a similar decline in open title insurance orders. All indications are that demand for refinance will continue to wane in the current rate environment.
Comments(0)