Housing Market Feels the Fed Taper Effect
With the Federal Reserve deciding to dial down its month bond purchases, mortgage interest rates climbed higher while home refinancing tumbled, according to the latest report from the Mortgage Bankers Association’s, which includes two weeks of information.
For the week ended January 3, 2014, loan applications increased 2.6 percent from one week earlier on a seasonally adjusted basis. There have only been a handful of increases over the past eight months as the housing market is starting to return to a more sustainable pace.
The figure includes both refinancing and home purchase demand, and covers more than 75 percent of all domestic retail residential mortgage applications. The seasonally adjusted purchase index fell 1 percent from the prior week. After plunging by 9 percent two weeks ago, the refinance index gained 5 percent last week.