Mortgage Demand Falls As Rates Rise Again

According to the Mortgage Bankers Association’s Weekly Applications Survey, average mortgage rates rose again last week, with increases for 30-year fixed-rate loans with both conforming and jumbo balances, loans backed by the Federal Housing Administration, 15-year fixed-rate loans, and 5/1 ARMs. The increases contributed to slower demand week-over-week. In fact, overall demand for mortgage applications fell 1.7 percent from the week before, with demand for home purchase loans 2 percent lower than one week earlier. Joel Kan, MBA’s vice president and deputy chief economist, says demand for loans to buy homes is at its lowest point in years. “Refinance applications were essentially unchanged, but purchase applications declined 2 percent to the slowest pace since 2015 – over 40 percent behind last year’s pace,” Kan said. “Despite higher rates and lower overall application activity, there was a slight increase in FHA purchase applications, as FHA rates remained lower than conventional loan rates.” The MBA’s weekly survey has been conducted since 1990 and covers 75 percent of all retail residential mortgage applications. (source)

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