Mortgage demand falls for 6th straight week, interest rates remain above 7%

Number: Mortgage applications are down 0.5% this week, while interest rates remain well above 7%.

Interest rates rose for the sixth week in a row, and homebuyers continue to hold off on buying homes.

The Mortgage Bankers Association (MBA) said Wednesday that high interest rates weighed on the Market Composite Index, a measure of mortgage application volume.

The market index fell 0.5% to 200.1 in the week ending 28 October. A year ago the index was 623.8.

Since the group began tracking data in 2000, the application continues to trend toward its lowest level.

Key details: The refinancing index rose 0.2%, but is down 85% from a year ago.

The Purchasing Index, which measures mortgage applications for home purchases, fell 0.8% from the previous week.

The purchasing index is falling at its slowest pace since December 2014.

The proportion of variable rate mortgages in activity fell to 11.8% application.

The average 30-year mortgage acceptance rate for homes sold under $647,200 was 7.06% in the week ending Oct. 28.

That’s down from 7.16% the week before, according to MBA. 30 years saw him drop for the first time in more than two months, but he’s still at a 20-year high, the MBA notes.

For homes sold for $647,200 and above, the 30-year average rate was 6.55%.

15 years dropped to 6.37%.

Rates on variable rate mortgages rose to 5.79%.

Big picture: Data continues to show that the housing sector is in turmoil.

High mortgage rates “will continue to put pressure on both buying and refinancing activity,” adding to “the ongoing affordability challenge impacting the broader housing market.” falling residential star When house salesaid Joel Kan, MBA Vice President and Deputy Chief Economist.

But there is a ray of hope. With homes on the market for longer, buyers have more choices than they did during the pandemic when they had to fight bidding wars. has been on the market for over 60 days. According to Zillow.

How it affects homebuyers: With an average monthly payment budget of $2,000, a year ago you could buy a home for about $467,800, 30 years down 3.24%, down 20%.

Currently, with interest rates of 7.06%, a buyer can only buy a home worth approximately $321,600.

market reaction: yield of 10-year government bond TMUBMUSD10Y,
4.046%
Over 4% in early morning trading.

Thinking about the housing market? Write to MarketWatch reporter Aarthi Swaminathan (aarthi@marketwatch.com).

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