Climbing mortgage rates have been dampening the red-hot pandemic housing market for a few months now.
Sellers are slashing prices while buyers are sitting on the sidelines, home sales are falling through, contingencies are back, and bidding wars have become more of an exception than the rule.
The most recent evidence of a cooling housing market comes in the form of mortgage loan applications: they were down 23% the week ending September 2 than the same week a year ago, according to the Mortgage Brokers Association.
Mortgage applications to refinance a home loan fell another 1% for the week and were 83% lower than the same week one year ago.
“Mortgage rates moved higher over the course of last week as markets continued to re-assess the prospects for the economy and the path of monetary policy, with expectations for short-term rates to move and stay higher for longer,” said Mike Fratantoni, MBA Senior Vice President and Chief Economist.