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Market Update - March 15, 2024

Friday, March 15, 2024

This Market Update is written by our Capital Market specialists each week to bring you insight into what's happening in the market and how it may affect mortgage rates and real estate trends.

Rates are provided by Housing Wire in conjunction with Polly. Rates are updated in real-time. Polly data is calculated using actual locked rates. Rates are inclusive of locks that occur below par, at par and therefore consider discounts and rebates.

Market Commentary:

For the week of March 8th - March 14th, 30-year and 15-year interest rates decreased. "The 30-year fixed-rate mortgage decreased again this week, with declines totaling almost a quarter of a percent in two weeks' time," said Sam Khater, Freddie Mac's Chief Economist.

Good news! The national economy is growing; unemployment is low; and corporate revenues are up.

With inflation still above the Fed's 2 percent goal and the job market holding strong, the Fed isn't likely to cut rates at its March meeting. "The Federal Reserve will not cut interest rates in the first half of this year, in my view," says Lawrence Yun, chief economist of the National Association of Realtors, "but rate cuts of three, four, or even five rounds will be possible in the second half of the year as rent measures will be much more well-behaved."

Key points from the Mortgage Bankers Association:

  • The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($766,550 or less) decreased to 6.84% from 7.02%
  • Applications to refinance a home loan, which are most sensitive to weekly rate moves, rose 12% for the week and were 5% higher than the same week one year ago.
  • Applications for a mortgage to purchase a home rose 5% for the week but were still 11% lower compared with the year before.

 

Fed Watch: Looking ahead to the upcoming March 20th, Federal Open Market Committee (FOMC) meeting. According to the CME Group, 0.00% of forecasters predict an increase in interest rates, while 99% predict rates will remain the same. 1% of forecasters expect rates to decrease.

Market Review:

Per Black Knight's Production Metrics, the breakdown of mortgage production volume is as follows: 84.02% for purchase transactions, 10.74% for cash-out refinances, and 5.24% for rate and term refinances.

Per Black Knight 52.32% of all Retail loan production were Government Loans (FHA, VA, USDA), while 47.68% were Conventional and Non-Conforming loans.

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