Homebuying has remained "pretty strong" despite higher mortgage rates, but the refinancing business has dropped "quite a bit," Bank of America CEO Brian Moynihan told CNBC in an interview that aired Friday on "Squawk Box."
"The purchase piece has been pretty consistent, which is important," but refi demand has been moving dramatically lower in the second and third quarter, Moynihan explained. BofA has already said it plans to layoff as many as 2,100 employees from its mortgage business.
This week, home loan rates continued to hover around two-year highs. But they did drop a bit, with the average cost of a 30-year fixed-rate loan coming in at 4.5 percent.
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"The higher interest rates will affect more first-time buyers," Mark Kiesel, Pimco's global head of corporate bonds, told "Squawk Box" on Friday. He follows housing trends by looking at debt opportunities among the big home-building companies, such as Toll Brothers.
This week, Toll Brothers CEO Douglas Yearley said he'd take a 4.5 percent to 5.5 percent mortgage rate in a good economy because from "2000 to 2006, which was a roaring time for housing, rates were 5.5 percent to 8 percent." Rates, even at current levels, are still historically cheap.