Mortgage Rates Dip Below 5% as Our BI Team Looks at the Real Estate Market
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The average 30-year fixed mortgage rate as of August 4 is 4.99%.
The current 30-year fixed mortgage rate has been up more than 55% since the beginning of 2022. Below we put mortgage rates in context, looking back 50 years by decade:
- 2020s: 3.41%
- 2010s: 4.09%
- 2000s: 6.29%
- 1990s: 8.12%
- 1980s: 12.70%
- 1970s: 8.90%
The Mortgage Bankers Association (MBA) reports weekly on two types of mortgage applications:
MBA Purchase Index
- MBA Purchase Index: The Purchase Index is a leading indicator of home sales by 4-6 weeks, meaning that it is a predictor of housing activity. Housing economists and home builders use the index to forecast new and existing home sales.
- MBA Refinance Index: The Refinance Index is a tool to predict mortgage activity. Homebuilders pay attention to the Refinance Index because it is a leading indicator of home sales. On the other hand, mortgage investors also take notice of the index as it is a leading indicator of mortgage pre-payment activity.
As of July 22, the Purchase Index sits at 206.4, down 26% since the beginning of 2022. We haven’t seen a Purchase Index this low since April 2020 when it hit 208.0
MBA Refinance Index
The Refinance Index stands at 631, down an astonishing 73% since the beginning of this year. You’d have to go back to December 2018 to find the Refinance Index at a similar level (730).
NOTE: Home sale data lags by several months, so our current Tableau viz is based on the most recent, seasonally-adjust home sales. Versus a year ago, sales are down 13%.
Again, visit our Tableau Public site for an interactive look at all the topics discussed above and other aspects of the U.S. economy.
To learn more about the RDS Business Intelligence team, contact:
Kacey Rask : Vice-President, Portfolio Servicing
/ 513.489.8877, ext. 261