With
the
calendar
shifting
to
September
and
the
next
meeting
of


Federal
Reserve
policymakers
only
two
weeks
out,
mortgage
rates
continue
to
recede
and
evidence
suggests
that
borrowers
are
reacting
to
more
favorable
housing
market
conditions.

At


HousingWire‘s
Mortgage
Rates
Center
on
Tuesday,
the
30-year
rate
for
conforming
loans
averaged
6.60%,
down
from
6.64%

one
week
ago.
The
15-year
conforming
rate
was
6.23%,
down
from
6.28%
a
week
ago.

Lower
rates
have
recently
sparked
more
activity
in
the
mortgage
market.


Attom
reported
last
week
that
the
number
of
originations

rose
23%
between
the
first
and
second
quarters
of
2024,
the
first
quarterly
increase
in
a
year.
Purchase
loan
activity
jumped
by
33%
and
refinance
activity
increased
by
10%
during
this
period.

“A
cautionary
note
is
warranted,
as
we
shouldn’t
read
too
much
into
one
great
quarter,”
Attom
CEO
Rob
Barber
said
in
a
statement.
”A
similar
trend
occurred
last
spring,
with
lending
dropping
off
significantly
later
in
the
year.
But
with
interest
rates
settling
down
and

projections
for
more
cuts
from
the
Federal
Reserve
over
the
coming
months,
it
wouldn’t
be
surprising
if
business
increased
even
more
for
lenders
over
the
rest
of
2024,
or
at
least
didn’t
drop
significantly.”

Despite
the
quarterly
increase,
the
total
number
of
originations
—
including
purchase,
refinance
and
home
equity
loans
—
were
down
1.6%
year
over
year
in
Q2
2024
and
were
61%
below
peak
activity
levels
of
2021.
Measured
by
dollar
volume,
originations
were
up
27.6%
from
the
prior
quarter
and
up
1.1%
year
over
year.

Last
week,


Freddie
Mac
reported
that
mortgage
rates
reached
their
lowest
level
since
May
2023.
In
response,


Bright
MLS
chief
economist
Lisa
Sturtevant
noted
that
while
“declining
rates
are
good
for
both
buyers
and
sellers,“
rates
are
not
yet
low
enough
to
alleviate

the
lock-in
effect
that
has
stopped
many
potential
listings
in
their
tracks.

“Nationwide,
there
is
an
average
three
percentage
point
gap
between
rates
on
new
and
existing
mortgages,“
Sturtevant
said
in
a
statement.
“This
rate
gap
has
kept
some
homeowners
from
listing
their
home
for
sale.
As
rates
fall,
the
rate
gap
is
going
to
be
less
of
an
obstacle
to
sellers.  

“Inventory
has
already
started
increasing
and
new
listing
activity
should
continue
to
grow
this
fall,“
she
added.
“The
housing
market
will
begin
to
move
toward
balance;
however,
buyers
will
still
find
the
market
competitive.
Mortgage
rates
will
bump
around
over
the
next
few
weeks
and
I
expect
rates
to
be between 6.2%
and
6.4%
at
the
end
of
the
year.“ 

Prospective
buyers
are
still
being
stymied
by
an
overall
lack
of
for-sale
inventory
in
many
areas
of
the
country.
Data
from


Altos
Research
shows
that
supply
has
likely
peaked
for
the
year
as

inventory
declined
slightly
to
704,000
single-family
homes
during
the
week
of
Aug.
30.
By
comparison,
there
were
more
than
969,000
single-family
listings
at
the
same
time
in
2019,
prior
to
the
COVID-19
pandemic.

Pending
home
sales,
a
forward-looking
indicator
of
closed
sales,
aren’t
responding
positively
either.
The


National
Association
of
Realtors
(NAR)
reported
last
week
that
pending
sales

declined
by
8.5%
year
over
year
in
July
to
reach
the
second-lowest
reading
in
the
history
of
the
dataset,
surpassed
only
by
the
frozen
market
conditions
of
April
2020
at
the
start
of
the
pandemic.

“Modest
improvements
in
affordability
may
not
be
enough
to
significantly
boost
demand,
as
household
incomes
remain
stretched
relative
to
mortgage
payments,“
said
Odeta
Kushi,
deputy
chief
economist
at


First
American,
in
response
to
the
pending
sales
report.
“Homebuying
will
not
pick
up
meaningfully
until
income
growth
begins
to
outpace
home
price
growth
and
mortgage
rates
move
lower.”

The
good
news
for
buyers
is
arriving
in
the
form
of
price
cuts,
with
more
than
39%
of
listings
now
going
for
less
than
their
original
list
price,
according
to
Altos
Research.
Additionally,
lower
sales
prices
are
making
monthly
mortgage
payments
more
affordable.
The


Mortgage
Bankers
Association
(MBA)
reported
last
week
that
the
national
median
payment
for
purchase
loan
applicants
declined
for
a
third
straight
month
in
July
to
$2,140.

Related