US Mortgage Demand Slumps To Lowest Level Since 2018
Demand for mortgages in the United States has slipped to its lowest level since the end of 2018.
Applications for mortgages for home purchases dropped 1% last week compared with the previous week, according to data from the Mortgage Bankers Association (MBA). Volume was 14% lower than the same week of 2021.
“Mortgage rates fell for the fourth time in five weeks, as concerns of weaker economic growth and the recent stock market sell-off drove Treasury yields lower,” commented Joel Kan, MBA’s associate vice president of economic and industry forecasting. “Mortgage applications decreased to its lowest level since December 2018, as the purchase market continues to struggle with supply and affordability challenges.”
Rising interest rates in the US, as well as steep gains in house prices, are having a heavy impact on affordability. However, while prices continue to rise due to limited market supply, different types of property buyers are having very different experiences.
“Demand is high at the upper end of the market, and the supply and affordability challenges are not as detrimental to these borrowers as they are to first-time buyers,” Kan explained.