Refinance dollar volume remains low

Fannie Mae reported little change in its weekly Refinance Application-Level Index (RALI) as the housing market continues to slow under the combined weight of rising inflation and interest rates.

The dollar volume of refinance applications for the week ending July 01 inched up 0.3% from the previous week, but chief economist Doug Duncan found that applications “did not rebound meaningfully” despite the holiday-driven contraction during the Juneteenth holiday the week before. Year over year, the RALI dollar volume was down 72.2%.

“With mortgage rates having moved sharply higher this year, the share of outstanding loans with incentive to refinance has declined significantly, reducing the overall level of refinancing activity,” Duncan said.