Mortgage demand decreases due to rise in interest rates since August.

• The interest rate for 30-year fixed-rate mortgages with conforming loan balances of $766,550 or less rose to 6.36%.
• The number of applications to refinance a home loan decreased by 9% in a week, although it was still higher than the same week a year ago.
• The number of mortgage applications for purchasing a home remained stagnant during the week.

The sudden increase in mortgage interest rates led to a decline in weekly demand from both prospective and current homeowners, resulting in a 5.1% decrease in total mortgage application volume, as per the Mortgage Bankers Association's seasonally adjusted index.

The interest rate for 30-year fixed-rate mortgages with conforming loan balances, $766,550 or less, rose to 6.36% from 6.14%, with points increasing to 0.62 from 0.61, including the origination fee, for loans with a 20% down payment. This was the highest rate since August.

The Mortgage Bankers Association's chief economist, Mike Fratantoni, stated that mortgage rates increased following the release of stronger economic data, including the September jobs report.

The number of applications to refinance a home loan decreased by 9% in the past week, despite being 159% higher than the same week a year ago. Mortgage rates were 131 basis points lower last year at this time.

Fratantoni stated that conventional loan refinances, which typically have larger balances than government loans, are more sensitive to changes in mortgage rates and therefore fell more during the week.

The number of mortgage applications for purchasing a home remained unchanged from the previous week, decreasing by 0.1%. Despite a 8% increase in purchase demand compared to the same week last year, home prices are still higher. Although mortgage rates have decreased compared to a year ago, inventory levels have improved but are still insufficient for affordable homes.

Last Friday, mortgage rates increased significantly after the release of the monthly employment report, which was stronger than expected. According to Mortgage News Daily, rates continued to rise on Monday, and the average 30-year fixed-rate mortgage is now at 6.62%. However, rates were unchanged on Tuesday.

According to Matthew Graham, chief operating officer at Mortgage News Daily, although the worst of the rapid, upward movement may have passed, new data is needed to put downward pressure on rates.