US 30 year mortgage contract rate drops to 7.41 percent

The average contract rate on conforming 30-year fixed mortgages dropped to 7.41 percent for the week ended Oct. 16, Tokenpost and Quartz reported. This marks a decline of 0.09 percentage point from 7.50 percent recorded the prior week. [1][6]

Treasury yields moved in different directions as benchmark borrowing costs adjusted. Tokenpost reported that 10-year and 30-year Treasury yields edged lower, while the two-year yield moved higher. The 10-year Treasury yield acts as a benchmark for mortgage lending, though the weekly mortgage rate measures a separate and earlier period. [1]

Initial jobless claims are a data point issued weekly by the United States Department of Labor as part of its Unemployment Insurance Weekly Claims Report. Tokenpost noted that new initial jobless claims for the week ended Oct. 17 are expected before the Federal Reserve holds its policy meeting on Oct. 27 and 28. [1][8]

Despite the drop in borrowing rates, housing demand remains under pressure. Realtor.com reported that home purchase mortgage applications dropped 18 percent compared to the same period last year. Quartz added that overall mortgage applications fell 5.3 percent during the same week. [5][6]