(Bloomberg) — US mortgage rates climbed back above 7% last week, driving a decline in applications to finance home purchases.
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The contract rate on a 30-year fixed mortgage rose 10 basis points, the steepest increase in more than two months, to 7.03% in the week ended June 28. Figures from the Mortgage Bankers Association also showed the five-year adjustable-rate mortgage climbed 9 basis points to a three-week high of 6.38%.
A gauge of mortgage applications to buy a home fell 3.3%, the first decline since the end of May, the figures released Wednesday showed. The drop indicates potential homebuyers remain sensitive to changes in borrowing costs and suggests a bumpy path to a more durable recovery for the housing market.
MBA’s overall index of applications, which includes those for home purchases and refinancing, slipped 2.6%. The group’s refinancing gauge fell for a third straight week.
The MBA survey, which has been conducted weekly since 1990, uses responses from mortgage bankers, commercial banks and thrifts. The data cover more than 75% of all retail residential mortgage applications in the US.
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