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As mortgage rates fall, prospective homebuyers have been locking in rates when looking for a home while current homeowners have been scouting out refinances at the highest rate in nearly two years.

According to an Optimal Blue report on July mortgage application activity, national refinance activity has hit a high not seen since September of 2022. Also, national purchase rate-lock volume has increased four percent month-over-month.

Brennan O’Connell, director of data solutions at Optimal Blue said in a statement that July’s slow fall in interest rates “played a significant role” in the increase in refi volume.

This comes as Freddie Mac reported Thursday that the average rate on a 30-year, fixed-rate mortgage has dropped to levels not seen in over a year, from 6.73 percent to 6.47 percent over the span of a single week. With prospective homebuyers being able to access lower rates, they are also able to access more financing and increase their chances of being able to buy a home.

“Mortgage rates plunged this week to their lowest level in over a year following the likely overreaction to a less than favorable employment report and financial market turbulence for an economy that remains on solid footing,” Freddie Mac Chief Economist Sam Khater said in a statement. “The decline in mortgage rates does increase prospective homebuyers’ purchasing power and should begin to pique their interest in making a move. Additionally, this drop in rates is already providing some existing homeowners the opportunity to refinance, with the refinance share of market mortgage applications reaching nearly 42 percent, the highest since March 2022.”