Rates may be rising, but mortgage and refinance applications are on a downward spiral according to the latest numbers out from the Mortgage Bankers Association.
The MBA’s Weekly Mortgage Applications Survey for the week ending October 7 found that purchase apps fell another 2 percent from the week prior, which was already hovering at record lows. Compared to the same week in 2021, applications are down some 68.7 percent.
The Refinance Index decreased 2 percent from the previous week and was 86 percent lower than the same week one year ago.
“Mortgage rates moved higher once again during the first week of the fourth quarter of 2022, with the 30-year conforming rate reaching 6.81 percent, the highest level since 2006. Mortgage rates increased across all product types in MBA’s survey, with the largest, a 20-basis-point increase, for 5-year ARM loans. The ARM share of applications remained quite high at 11.7 percent—just below last week’s level,” said Mike Fratantoni, MBA’s Senior Vice President and Chief Economist. “Application volumes for both refinancing and home purchases declined and continue to fall further behind last year’s record levels. The news that job growth and wage growth continued in September is positive for the housing market, as higher incomes support housing demand. However, it also pushed off the possibility of any near-term pivot from the Federal Reserve on its plans for additional rate hikes.”