Small dip in rates boosts first-time home-buying activity

  • Mortgage applications increase despite rates staying over 7%
  • First-time home-buying activity drives up market composite index
  • Demand for adjustable-rate mortgages and FHA purchase loans rises
  • Refinance index also sees an 8.1% increase
  • Average contract rate for 30-year mortgage decreases slightly
  • Some first-time buyers motivated to purchase before spring home-buying season
  • Uptick in for-sale home listings provides additional motivation for buyers
  • Purchase volume, especially for FHA loans, shows sensitivity to rate changes
  • New listings see a significant increase in nearly three years

U.S. mortgage applications have increased despite mortgage rates remaining over 7%. The market composite index, which measures mortgage application volume, rose by 9.7% in the last week, driven by an increase in first-time home-buying activity. The purchase index, which measures mortgage applications for home purchases, rose by 10.6% from the previous week. Demand for adjustable-rate mortgages also saw a 12.5% increase. First-time buyers were active in the market, as evidenced by the 13.5% increase in Federal Housing Administration purchase loans. The refinance index also rose by 8.1%. The average contract rate for a 30-year mortgage decreased slightly to 7.02%. Despite the high rates, some first-time buyers are motivated to purchase before the spring home-buying season, anticipating a drop in rates later in the year. With an increase in for-sale home listings, buyers may feel additional motivation to purchase now while inventory is easing. New listings saw the biggest increase in nearly three years.

Factuality Level: 8
Factuality Justification: The article provides specific data and statistics from the Mortgage Bankers Association to support its claims about the increase in mortgage applications and first-time home-buying activity. It also includes quotes from a senior vice president and chief economist at the MBA, adding credibility to the information presented. The article does not contain any obvious bias, misleading information, or sensationalism.
Noise Level: 2
Noise Justification: The article provides relevant information about the increase in U.S. mortgage applications, including key details such as the rise in first-time home-buying activity and the average rates. It also includes insights on the motivations behind the increase in purchases and quotes from a senior vice president and chief economist at the Mortgage Bankers Association. The article stays on topic and supports its claims with data and examples, making it a valuable source of information for those interested in the mortgage market.
Financial Relevance: Yes
Financial Markets Impacted: Mortgage market, housing market
Presence Of Extreme Event: No
Nature Of Extreme Event: No
Impact Rating Of The Extreme Event: No
Rating Justification: The article discusses the increase in mortgage applications, specifically driven by first-time homebuyers, despite mortgage rates staying over 7%. This information is relevant to the financial and housing markets.
Public Companies: Mortgage Bankers Association (N/A), Redfin (N/A)
Key People: Mike Fratantoni (Senior Vice President and Chief Economist at the Mortgage Bankers Association)

Reported publicly: www.marketwatch.com