In a recent article submitted by Diana Olick on CNBC, she reports that weekly mortgage demand from homebuyers tumbled 12%, as higher interest rates take their toll. She makes these key points:
Mortgage Demand Slides
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It’s No Surprise that Refinance Mortgage Application Volume Continues to Fall
If you have kept an eye on mortgage interest rates as they climb to the highest point in years, it’s no surprise to read this article on MortgageNewsDaily state “The Mortgage Bankers Association’s (MBA) latest weekly mortgage application data shows an ongoing and unsurprising decline in refinance applications.” In light of increased prices and rising rates it is interesting to note that purchase application volume is only seeing a slight decline.
Mortgage Application Volume Drops 8% in One Week
Rapidly rising mortgage interest rates are having a direct impact on mortgage application volumes, particularly for mortgage refinance applications. In an article by Adam DeSanctis for the Mortgage Bankers Association (MBA) “The Market Composite Index, a measure of mortgage loan application volume, decreased 8.1 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased 8 percent compared with the previous week. The Refinance Index decreased 14 percent from the previous week and was 54 percent lower than the same week one year ago.”
Mortgage Interest Rates see the Biggest 3-month Rate Spike since 1994
According to an article written by Matthew Graham for Mortgage News Daily “Adults who are old enough to remember 1994 have always had an ace in the hole when it comes to today’s young whipper snappers complaining about abrupt spikes in mortgage rates. Sure, even older adults have the first few months of 1980, but 1994 was a more compelling example because it wasn’t part of the once-in-a-lifetime inflationary spike. As such, it is a more worthy comparison to any modern example of rate volatility. As of today, the race between the first few months of 1994 and 2022 are neck and neck in terms of damage done to mortgage rates in a short amount of time.”
Rising Mortgage Rates Are the Buzz with Home Buyers
Whether you are in the market to buy or refinance a home, everyone is talking about the rising mortgage interest rates! Many predictions and questions are included in conversations on this topic, along with the variety of national and worldwide changes that are affecting the rates.
Refinance Index is 50 Percent Lower than Same Week in January Last Year
According to the Mortgage Bankers Association (MBA) Market Composite Index, the Refinance Index is 50 percent lower compared to the same week one year ago, in January 2021. During the same week there was a small uptick over last year in purchase mortgage activity.
Learning About The Multiple Factors In Play Each Time Mortgage Rates Change
If you are like most Americans, you’ve spent the last few years watching mortgage rates reach historic lows. It is a complex set of factors that impact mortgage rates, and many articles attempt to simplify it.
A recent article on MortgageNewsDaily.com goes into great detail about the various aspects, including graphs that help us visualize what they are saying, It’s a good read if you want to gain a better understanding of the topic.
Fannie Mae Revises Forecast for Home Sales
In an informative article written by Jann Swanson for MortgageNewsDaily.com Fannie May has revised the timeline for its home sales forecast. There are multiple factors stated in the article that is affecting the forecast, including:
- Limited Inventory
- Increase in Prices
- Rising Mortgage Rates
Residential Mortgage Application Volume has Decreased
Recent months have seen a reduction in residential mortgage applications. There are varying speculations as to the reasons for this decline in applications:
- Waiting for Rates to Reduce Further
- Concerns over the Future of Economy
- Pandemic Resurgence Causing Hesitation
Residential Purchase Mortgage Applications Increase
Residential Purchase Mortgage Applications posted the largest increase since early July, which many sources say is a result of increased inventory and slightly reduced mortgage interest rates.