The housing market may be strengthening, and the steady mortgage rate situation could be a major helper in this situation.
There was a slight decline in the 30-year fixed-rate mortgage average as it posted 4.13 percent during the week ending July 17, 2014, according to a report from the Primary Mortgage Market Survey from Freddie Mac. One week earlier, the figure was 4.15 percent. A year earlier, the level reached 4.37 percent.
Another minor drop occurred for the 15-year FRM, as it dropped to an average of 3.23 percent in the latest reading, slightly lower than the previous level of 3.24 percent, the report showed. Both figures were well below the year-ago average, which was 3.41 percent.
"Mortgage rates were little changed amid a week of light economic reports," said Frank Nothaft, vice president and chief economist at Freddie Mac. "Of the few releases, industrial production rose by 0.2 percent in June, below the market consensus forecast. Also, the producer price index for final demand rose 0.4 percent in June, rebounding from a 0.2 percent decline the prior month."
Declines also occurred in the adjustable-rate mortgage measurements. The report explained that the five-year Treasury-indexed hybrid ARM posted an average of 2.97 percent in the most recent reading, a drop from the previous level of 2.99 percent. It also was down from 12 months ago, when the average was 3.17 percent.
For the one-year Treasury-indexed ARM, the averaged slid to 2.39 percent from one week earlier when it was 2.4 percent, the report added. A year ago, the level was 2.66 percent.
Mortgage applications fall
Even with the relatively stable mortgage rate situation, there still was a decline in residential mortgage applications. According to the Weekly Mortgage Applications Survey, overall home loan applications fell 3.6 percent during the week ending July 11, 2014 compared to one week earlier. When the figure was unadjusted, it actually rose 20 percent week-over-week. The Purchase Index fell 8 percent week-over-week.
Refinances had a mixed bag for the week. The report showed that the Refinance Index slid 0.1 percent during the latest reading. However, the refinance share of mortgage activity improved to 54 percent of all applications, slightly higher than one week earlier, when the figure was 52 percent. There was no change in the adjustable-rate mortgage share, as it posted 8 percent again.