US mortgage applications rise as rates fall for 7th week to lowest since September 2022

‘Application activity was up significantly last week, as market expectations of a rate cut from the Fed pulled mortgage rates lower,’ says economist

By Ovunc Kutlu

ISTANBUL (AA) - US mortgage applications rose last week, as rates declined for the seventh consecutive week to their lowest in two years, according to a Mortgage Bankers Association (MBA) report released Wednesday.

The market composite index, a measure of mortgage loan application volume, jumped 14.2% on a seasonally adjusted basis for the week ending Sept. 13. On an unadjusted basis, however, the index soared 26% compared to the previous week.

"Application activity was up significantly last week, as market expectations of a rate cut from the Fed pulled mortgage rates lower," Joel Kan, MBA’s vice president and deputy chief economist, said in a statement.

"There was also an increase in purchase applications, and it is notable that conventional purchase applications increased to a pace ahead of last year, which also drove overall purchase applications very close to year-ago levels," said Kan. "Homebuyers are seeing improving affordability conditions, sparked by lower rates and slower home-price growth."

The average contract interest rate for 30-year fixed-rate mortgages declined for the seventh consecutive week to 6.15%, their lowest since September 2022, from 6.29% in the previous week.

The rate for 15-year fixed-rate mortgages, meanwhile, decreased to 5.42% from 5.71% during that period.

The MBA survey covers more than 75% of US retail residential mortgage applications.

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