July was a disappointing month for mortgage activity overall, with earlier high borrowing costs causing home purchase applications to slide by 5.4% m/m. All the attention, however, will be on the last week of the month when mortgage rates fell sharply to 6.55%, after hovering around 7% for most of the year. That should set the stage for a modest recovery in transactions in the rest of the year, providing that recession fears prove unfounded as we expect.
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