On Friday, residential real estate brokerage firm Redfin released new data on home prices, showing that prices fell 0.6 percent in February, year over year. According to Redfin’s numbers, this was the first time that home prices actually fell since 2012.
Homebuyer affordability worsened in October as higher mortgage rates pushed the monthly payment to record highs.
It’s a double whammy for would-be homebuyers. Not only are interest rates soaring, it’s getting harder to qualify for a loan. The average rate on the popular 30-year fixed mortgage climbed over 7% at the end of last week, according to Mortgage News Daily, and is expected to hit around 7.125% on Tuesday. It’s been over 7% for several days.
Mortgage applications on Wednesday became the latest sign showing how hard rates are hitting housing. And it could get worse.
The pace of mortgage applications has fallen to a multi-decade low amid high housing interest rates, according to the latest data from the Mortgage Bankers Association (MBA).
Mortgage rates drove even higher last week after the Federal Reserve signaled it would continue its aggressive action to cool inflation. That, and rising uncertainty in the overall housing market, caused mortgage application volume to drop 3.7% last week compared with the previous week, according to the Mortgage Bankers Association’s seasonally adjusted index.
Mortgage rates jumped more than a quarter point this week and remain at the highest level in 14 years, offering no relief to sidelined homebuyers.
The average interest rate on the most popular U.S. home loan climbed to its highest level since October 2008, Mortgage Bankers Association (MBA) data showed on Wednesday.
Bank of America this week announced that it will be launching a mortgage option for first-time home buyers offering no down payments, no closing costs and no minimum credit score.
Wells Fargo & Co. said it’s weighing the size of its mortgage business in the face of a “dramatically smaller originations market” as home buyers retreat from higher interest rates and lending capital grows more scarce.