Mortgage demand jumps as rates drop
Published On Nov 27, 2024, 12:11 PM
Mortgage demand has seen a significant increase as long-term mortgage rates have begun to decline. The Mortgage Bankers Association reported a 6.3% rise in overall mortgage applications, driven by a 52% annual increase in purchase demand. The average rate for a 30-year fixed mortgage dropped slightly to 6.81%, continuing a trend of flat rates in recent weeks. However, despite the increase in applications, the housing inventory remains low, and many potential buyers are waiting for even lower rates before committing.
Stock Forecasts
DHI
Positive
The increase in mortgage applications indicates a renewed interest in home purchases, which may benefit housing-related stocks. Companies involved in home construction, mortgage lending, and real estate may see a positive impact from this surge in demand as it could lead to greater sales and profitability.
RDN
Negative
The overall decline in home affordability continues to be a concern, potentially limiting long-term housing market growth. If rates do not significantly decrease, the housing market may still face challenges. Companies heavily reliant on new mortgage volume could be negatively impacted if the market does not stabilize.
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