Demand for Mortgages Drops to Nearly 3-Decade Low

Demand for Mortgages , Drops to Nearly , 3-Decade Low.

NBC reports that mortgage rates rose even higher last week at a time when the spring housing market is typically heating up.

Mortgage applications for new homes dropped six percent compared to the previous week.

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According to the Mortgage Bankers Association's seasonally adjusted index, volume was 44% lower than the same time in 2022, reaching a 28-year low.

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Meanwhile, average contract interest rates on 30-year fixed-rate mortgages increased to 6.71% with a 20% down payment.

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NBC reports that this is the highest rate since November of 2022.

In just the last month, mortgage rates have climbed 50 basis points higher.

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Data on inflation, employment, and economic activity have signaled that inflation may not be cooling as quickly as anticipated, which continues to put upward pressure on rates, Joel Kan, MBA economist, via NBC.

Refinance applications account for less than a third of all applications and remained more than 70% behind last year’s pace, as a majority of homeowners are already locked into lower rates, Joel Kan, MBA economist, via NBC.

NBC reports that mortgage rates appear to be on a trajectory to continue rising despite a brief respite in January.

Current mortgage demand from homebuyers would seem to indicate a slow spring ahead for the housing market