A new report shows that rate and term refinances increased 25.6% in May as mortgage rates trended downwards best blue. The surge was in response to a slight decline in 30-year conforming mortgage rates, which fell to 6.8% on May 15, but the Best Blue Mortgage Market Index (OBMMI) ended the month at 7.02% .
Director Brennan O’Connell said: “The sharp increase in demand for interest rates and term refinancing following the fall in interest rates suggests that homeowners with interest rates above 7 per cent are feeling the pinch and are concerned about the current economic climate. “For context, rates have only exceeded 7.02% on 120 market days since Optimal Blue began tracking the 30-year consensus rate as a market index in January 2017.” For good measure, mortgage rates for buyers who locked in loans in those days were the highest in the past two decades.
The total transaction volume in May increased by 5.3% compared with the previous quarter and 1.8% compared with the same period last year. This growth was driven by a 4.1% sequential increase in purchase lock-in volume, a 7.2% increase in cash-out refinances, and substantial increases in interest rates and term refinances. However, the number of purchase lock-ins, “a key market health indicator that controls volatility in home price appreciation and refinancing, was down 4% from the same period last year.”
Despite a monthly increase of 25.6% from April, the market volume index for interest rate term refinancing remained at 6 (the total volume index in January 2018 was 100). There were 9 cash-out refinances and 94 purchase mortgages.
Qualified loans accounted for 57.2% of total loans, of which federal housing administration is 18.4%, VA According to Optimal Blue, the NPL ratio is 10.8% and the NPL ratio is 13.0%.
The purchase pull-through rate in May was 79.9%, a decrease of 184 basis points from April. The refinancing pull-through rate in May was 59.4%, down 115 basis points from April and 295 basis points from February. In May 2023, the refinancing pull-through rate was approximately 65%.
Nationally, Northeastern markets have seen the largest increase in lockdowns, according to Optimal Blue. The Boston-Cambridge-Newton, Massachusetts-New Hampshire subway’s locked rates increased by 17.8%, followed by the New York-Newark-Jersey City subway, which increased by 16.4%.
The Washington, D.C., Dallas, Denver, Miami and Phoenix metro areas all saw decreases in lockdowns in May.
The average loan amount was flat at $374,500 in May, and the average home purchase price increased for the fifth consecutive month, rising from $477,900 to $480,300.
