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Joel Kan reports mortgage application volume dropped as interest rates reached a three-week high

Mortgage interest rates rose last week, causing a decline in demand for home loans. Joel Kan, vice president and deputy chief economist at the Mortgage Bankers Association, reported that total mortgage application volume fell by 1% from the previous week. The average 3-0 year fixed-rate mortgage rate increased to 6.78% from 6.77% the prior week, marking the highest level in three weeks. This trend is driven by ongoing investor fears regarding inflation and the impact of the Iran conflict on oil prices. While purchase activity has slowed, some reports indicate that fewer buyers are using all-cash offers, making sellers more likely to accept financed buyers. Despite the volatility in the bond market, the 10-year Treasury yield remains a key indicator for mortgage pricing. The U.S. housing market continues to experience a slump as rates remain significantly higher than pandemic-era lows, leading many prospective home shoppers to delay purchases.

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