The Mortgage Bankers Association’s seasonally adjusted index shows that mortgage applications increased 2.2% last week compared to the prior week, driven by a small drop in interest rates.

Applications for refinances, which are often the most sensitive to weekly rate changes, increased by 2% for the week but remained 86% lower than they had been the previous year. Only 220,000 people, according to real estate data company Black Knight, can still profit from a refinancing, despite interest rates have dropped from their recent high of 7.16% a month ago.

Mortgage applications to buy a property increased by 3% for the week but were down 41% from the previous year. Despite the fact that some prospective buyers may be entering the market once again now that they have more negotiation power and less competition, there are still not enough available properties for sale, and prices have not decreased considerably.

Despite last week’s little easing, rates are still double what they were at the start of the year. For loans requiring a 20% down payment, the average contract interest rate for 30-year fixed-rate mortgages with conforming loan amounts ($647,200 or less) dropped from 6.90% to 6.67%, but the number of points increased from 0.56 to 0.68 (including the origination fee).

Joel Kan, an MBA economist, said in a release that the drop in mortgage rates “could increase the purchasing power of potential homebuyers, who have been largely ignored while mortgage rates have more than doubled in the previous year.” “With the reduction in rates, the ARM share [adjustable-rate mortgage] of applications also declined to 8.8% of loans last week, down from the range between 10% and 12% during the previous two months,” says the report.

Due to the usual volume drag caused by the approaching Thanksgiving holiday, mortgage rates haven’t changed at all this week.

It’s not that nothing is happening. According to Matthew Graham, chief operating officer of Mortgage News Daily, “They just aren’t moving like normal. Expect the situation to return to more normal levels the following week, but for the largest changes, the market should continue to wait until December 13 and 14.

When the Federal Reserve makes its next announcement about interest rates, the government issues its upcoming significant report on inflation.

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