Mortgage professionals who are still recovering from their Thanksgiving food coma may want to check out last week's industry news highlights, which reported a surprising uptick in buyer interest despite last month's poor market outlook.
'Sale Pending' Transactions Rise In October
Pending home sales increased for the third consecutive month this October, according to the National Association of Realtors' (NAR) latest release.
A forward-looking indicator of home sales based on contract signings, the NAR's Pending Home Sales Index (PHSI) rose by 2% to 77.4 in October. An index of 100 is equal to the level of contract activity in 2001.
Pending transactions increased 5.4% above Oct. 2023's figures.
Increasing job activity, coupled with more housing inventory, is bringing more home buyers off the sidelines following two years of suppressed home sales.
This follows a 17.3% decrease in new home sales in October.
Affordability Falls
Affordability dropped in October by 2.6% following four consecutive months of improvements, thanks to rising rates leading up to the election. With this, home buyers lost more than $14,000 in buying power, according to First American Data & Analytics.
On an annual basis however, affordability rose by 11%. First American attributed this to two factors -- a 3.4% annual increase in nominal household income and a 1.2 percentage point decrease in the average 30-year, fixed mortgage rate compared with one year ago.
Home price appreciation stabilized at 3.8% in October, though still reaching another record high.
The median mortgage payment applied for by purchase applicants increased to $2,127 in October from $2,041 in September, the MBA reported. Rejections for overall mortgage applications rose to 22.6% in Oct. 2024, up from 13% in Oct. 2023.
Mortgage Apps Jump 6.3%
Mortgage applications increased 6.3% from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending Nov. 22, 2024.
The refinance share of mortgage activity fell to 38.8% of total applications from 41% the previous week. The adjustable-rate mortgage (ARM) share of activity increased to 6.6% of total applications.
The FHA share of total applications decreased to 16% from 16.6% the week prior. The VA share of total applications decreased to 12.4% from 13.6% the week prior. The USDA share of total applications increased to 0.5% from 0.4% the week prior.
Mortgage Rates Drop Slightly
The 30-year fixed-rate mortgage (FRM) averaged 6.81% Nov. 27, according to the results of Freddie Mac's latest Primary Mortgage Market Survey.
The 30-year FRM averaged 6.81 percent as of November 27, 2024, down from last week when it averaged 6.84 percent. A year ago at this time, the 30-year FRM averaged 7.22 percent.
The 15-year FRM averaged 6.10 percent, up from last week when it averaged 6.02 percent. A year ago at this time, the 15-year FRM averaged 6.56 percent.
