That was Fast: Mortgage Rates Re-Spike to 7%
It Sinks in that the Fed Won’t Cut Rates “Anytime Soon,” Mortgage Applications Plunge to 1995 Levels. Even Investors Pull Out.
Spring selling season was a dud. But what comes next may be worse, that’s what mortgage applications and investors tell us.
The 7% mortgages are back. The average interest rate on 30-year fixed-rate mortgages with conforming balances jumped to 6.91%, the highest since November, according to the weekly measure by the Mortgage Bankers Association today.
The daily measure by Mortgage News Daily already went over 7% a few days last week and earlier this week.
“Inflation is still running too high, and recent economic data is beginning to convince investors that the Federal Reserve will not be cutting rates anytime soon,” is how the Mortgage Bankers Association explained today what has been obvious to us here for months.
And so, with these kinds of mortgage rates, spring selling season – the time of the year when sales and prices nearly always rise from the dreary days of the winter – has turned into an amazing dud.
Applications for mortgages to purchase a home dropped for the third week in a row, from already low levels to the third-lowest volume since 1995, the two lowest volume weeks having been in late February this year, according to the MBA today.
Purchase mortgage applications plunged, compared to the same week in:
- 2022: -31%
- 2021: -41%
- 2019: -40%.
What comes next may get sloppy. Mortgage applications to purchase a home are a forward-looking indicator of where home sales as measured by closed deals are headed in a month or two…..
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