The rising mortgage rates have effectively suppressed mortgage applications, with a reported 21.9% decline in application volume as the holiday season progressed, indicating a significant dip in both refinance and purchase applications.
Mike Fratantoni, the MBA's senior vice president and chief economist, noted that as mortgage rates approached 7 percent for 30-year fixed-rate loans, it was unsurprising to see declines in applications amid a typically slow housing market.
Data from HousingWire's Mortgage Rates Center indicated a continuous increase in home loan costs, with 30-year conforming loans averaging 7.10% as of December 27, escalating the downward trend in mortgage demand.
The refinance share of all mortgage applications dropped to 39.4%, underlining a substantial shift away from refinancing options as higher rates became the new reality for borrowers.
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