Concerns over the coronavirus have driven the 10-year Treasury yield to record lows, which helped push mortgage rates to a seven-year low last week. That gave a substantial boost to refinancing activity, but applications for home purchase dropped back. Concerns over the economic outlook, and the risks of heading out to view properties, will offset the benefit of lower financing costs. On the basis of a relatively limited rise in new cases, we expect home purchase demand to drop by 10% over the next few months.
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