For the first time in five weeks, mortgage demand decreases following an increase in interest rates.

• The interest rate for 30-year fixed-rate mortgages with conforming loan balances rose from 6.67% to 6.75%.
• Refinance demand fell 3% for the week.
• The number of mortgage applications for purchasing a home rose by 1% in the current week and was 6% greater compared to the corresponding week last year.

Last week, a significant increase in mortgage rates led to a decrease in overall mortgage demand.

The Mortgage Bankers Association's seasonally adjusted index showed a 0.7% decrease in total application volume compared to the previous week, marking the first decline in five weeks.

The interest rate for 30-year fixed-rate mortgages with conforming loan balances increased by 8 basis points to 6.75% from 6.67%, with points remaining unchanged at 0.66 (including the origination fee) for loans with a 20% down payment. This rate is 8 basis points higher than the same week one year ago.

The drop in refinance demand was due to a 3% decline in the week, but it was still 41% higher than the same week a year ago. Although mortgage rates haven't changed significantly, the low refinance volume may make any slight change seem like a significant comparison.

The number of mortgage applications for purchasing a home rose by 1% in the current week and was 6% greater compared to the corresponding week last year.

This week's increase in purchase activity on a weekly and annual basis was driven by conventional and VA purchase applications, according to Joel Kan, vice president and deputy chief economist at the MBA. Buyers remained active in the purchase market, with gradually improving inventory conditions and a more positive outlook on the economy and job market helping to boost their activity.

According to Mortgage News Daily, mortgage rates have remained mostly unchanged at the beginning of the week. The market is anticipating the Federal Reserve's meeting on Wednesday, where a rate cut is predicted. However, some analysts believe that this may be the final cut for some time.

"The dot plot, which is a rate outlook survey updated four times a year and closely monitored by bonds, will show a higher rate trajectory than September, according to Matthew Graham, chief operating officer at Mortgage News Daily. However, what is uncertain is how pessimistic or hawkish of a Powell the market is willing to tolerate."