Mortgage interest rates just hit a level not seen since the year 2000. As a result, mortgage demand is now sitting near a 27-year low.
Total mortgage application volume fell 1.3% last week compared with the previous week, according to the Mortgage Bankers Association’s seasonally adjusted index. Volume was 25.5% lower than the same week one year ago.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($726,200 or less) increased to 7.41%, from 7.31%, with points decreasing to 0.71 from 0.72 (including the origination fee) for loans with a 20% down payment. The rate was 6.52% one year ago.
The 30-year fixed jumbo mortgage rate increased to 7.34%, the highest rate in the history of the MBA’s jumbo rate series dating back to 2011.
Let’s be real: the demand is as high as ever, but no one can afford the current prices + interest rates, and they know it, so they’ve given up trying.
I was explaining this to my father the other day. He’s considering moving and I did a little math for him on what the payment would be if he buys something at the same price point. Mortgage would go up over 50%.
It’s honestly astonishing the markets been flat with the increased rates. People shouldn’t, but they buy as much as they can possibly afford/can qualify for more often than not. With current rates the most people can afford is much more often becoming nothing.
I got lucky and bought a house when interest rates were still pretty low, though not rock bottom. I appreciate and am grateful for that, especially considering that I never in my life believed that I would be able to buy a house. However, I don’t like the house and would like to sell it and move in a few years, but it seems so unlikely to be realistic. The low interest rate is a benefit and a burden.
Yep. We want to move out of this shithole town. We know where we want to move. We would move tomorrow but at the current rates, we’d be destroyed financially if we did. And we own our home.