Rates Rose at End of 2017 But Buyers Undeterred
January 9, 2018
Mortgage rates rose to the highest average in months at the end of 2017, but home buyer applications still posted an uptick.
Mortgage applications for home purchases rose 1 percent in the final two weeks of the year. Home purchase applications ended the year 3 percent higher than at the end of 2016, the Mortgage Bankers Association reported Wednesday.
However, the increase in applications for home purchases was not enough to lift the overall index. Total mortgage application volume—which reflects for home purchases and refinancings—on the MBA’s index dropped 2.8 percent in the last two weeks of 2017.
Applications to refinance plunged 7 percent during that time period. However, refinance applications did end the year 1.8 percent higher than the end of 2016, the MBA reports.
The average on a 30-year fixed-rate mortgage closed the year at 4.25 percent, the MBA reported. That marks the highest rate since April.
"With the passage of the tax reform bill, there were increased expectations of stronger economic growth, which pushed rates higher," says Joel Kan, an MBA economist.
Source: “Mortgage Applications End 2017 Lower as Rates Rose,” CNBC (Jan. 3, 2018)
Updated: August 07, 2020