{"id":2035596,"date":"2023-09-17T22:34:01","date_gmt":"2023-09-18T02:34:01","guid":{"rendered":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/mortgage-application-volume-tumbles-to-lowest-levels-in-nearly-30-years-as-home-costs-soar\/"},"modified":"2023-09-17T22:39:21","modified_gmt":"2023-09-18T02:39:21","slug":"mortgage-application-volume-tumbles-to-lowest-levels-in-nearly-30-years-as-home-costs-soar","status":"publish","type":"post","link":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/mortgage-application-volume-tumbles-to-lowest-levels-in-nearly-30-years-as-home-costs-soar\/","title":{"rendered":"Mortgage applications plummet to 30-year low amid surging home prices."},"content":{"rendered":"<aside class=\"mashsb-container mashsb-main mashsb-stretched\"><div class=\"mashsb-box\"><div class=\"mashsb-count mash-medium\" style=\"&quot;\"><div class=\"counts mashsbcount\">20<\/div><span class=\"mashsb-sharetext\">SHARES<\/span><\/div><div class=\"mashsb-buttons\"><a class=\"mashicon-facebook mash-medium mash-nomargin mashsb-noshadow\" href=\"https:\/\/www.facebook.com\/sharer.php?u=https%3A%2F%2Fwww.conservativenewsdaily.net%2Fbreaking-news%2Fmortgage-application-volume-tumbles-to-lowest-levels-in-nearly-30-years-as-home-costs-soar%2F\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Facebook<\/span><\/a><a class=\"mashicon-twitter mash-medium mash-nomargin mashsb-noshadow\" href=\"https:\/\/twitter.com\/intent\/tweet?text=&amp;url=https:\/\/www.conservativenewsdaily.net\/breaking-news\/?p=2035596&amp;via=ConservNewsDly\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Twitter<\/span><\/a><a class=\"mashicon-subscribe mash-medium mash-nomargin mashsb-noshadow\" href=\"#\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Subscribe<\/span><\/a><div class=\"onoffswitch2 mash-medium mashsb-noshadow\" style=\"display:none\"><\/div><\/div>\n            <\/div>\n                <div style=\"clear:both\"><\/div><\/aside>\n            <!-- Share buttons by mashshare.net - Version: 4.0.47--><blockquote>\n<div data-post-content=\"true\" class=\"post_content\" id=\"post_content\">\n<p>The mortgage application\u200b volume has plummeted to its lowest point in nearly three decades, as monthly mortgage payments reach an all-time high.<\/p>\n<div class=\"my-5\">In the past few weeks, mortgage\u2063 rates for 30-year loans \u2064have soared to over 7 percent, causing mortgage payments to skyrocket to near-record levels, <a href=\"https:\/\/www.redfin.com\/news\/housing-market-update-home-prices-increase-low-inventory\/\" target=\"_blank\" rel=\"noopener\"><u>according to the\u2062 latest data<\/u><\/a>  from Redfin.<\/div>\n<p>Simultaneously, the scarcity of available homes \u2064has driven up \u2063home prices, making it increasingly difficult for many potential buyers to enter\u2063 the market.<\/p>\n<div class=\"shortcode\">\n<div class=\"border-comp-divider mb-4 mr-4 w-full max-w-[500px] border px-5 py-4 text-[16px] leading-[20px] text-[#262626] md:float-left\" id=\"in_article_related_stories\">\n<div class=\"mb-3 font-sans text-[16px] font-semibold uppercase leading-[19px] text-[#2F2F2F]\">Related Stories<\/div>\n<div class=\"mb-4 flex gap-2\">\n<div class=\"grow\">\n<div class=\"mb-1 line-clamp-2\"><a href=\"http:\/\/www.theepochtimes.com\/article\/analysis-us-housing-market-facing-many-challenges-from-high-mortgage-rates-to-lack-of-supply-5482024\">ANALYSIS: US Housing Market Facing Many Challenges From High Mortgage\u200c Rates to Lack of Supply<\/a><\/div>\n<div class=\"text-comp-caption text-[14px] leading-[18px]\">8\/29\/2023<\/div>\n<\/div>\n<div class=\"shrink-0 basis-[120px]\"><a href=\"http:\/\/www.theepochtimes.com\/article\/analysis-us-housing-market-facing-many-challenges-from-high-mortgage-rates-to-lack-of-supply-5482024\"><\/a><\/div>\n<\/div>\n<div class=\"mb-4 flex gap-2\">\n<div class=\"grow\">\n<div class=\"mb-1 line-clamp-2\"><a href=\"http:\/\/www.theepochtimes.com\/real-estate\/demand-for-mortgages-falls-to-lowest-point-in-nearly-three-decades-5487846\">Demand for Mortgages Falls to Lowest Point in Nearly Three Decades<\/a><\/div>\n<div class=\"text-comp-caption text-[14px] leading-[18px]\">9\/7\/2023<\/div>\n<\/div>\n<div class=\"shrink-0 basis-[120px]\"><a href=\"http:\/\/www.theepochtimes.com\/real-estate\/demand-for-mortgages-falls-to-lowest-point-in-nearly-three-decades-5487846\"><\/a><\/div>\n<\/div>\n<\/div>\n<\/div>\n<div class=\"my-5\">As a \u200bresult, housing \u200ddemand has\u2064 plummeted to near-record lows due to affordability pressures. <\/p>\n<h2>Average Mortgage Payments Continue to Rise<\/h2>\n<p> \u200b The typical\u200d monthly mortgage payment has reached $2,612\u2064 with a 7.18\u200d percent mortgage rate during\u200b the four weeks ending Sept. 3, coming just $18 shy of the\u2064 previous record set in May, as reported by Redfin.<\/p><\/div>\n<div class=\"my-5\">Mortgage-purchase \u200bapplications have experienced a staggering 28 percent year-over-year decline, marking \u2064a\u200b 28-year low, <a href=\"https:\/\/www.mba.org\/news-and-research\/newsroom\/news\/2023\/09\/06\/mortgage-applications-decrease-in-latest-mba-weekly-survey\" target=\"_blank\" rel=\"noopener\"><u>according to data<\/u><\/a>  from the Mortgage Bankers Association (MBA).<\/div>\n<p>Pending home sales have also dropped by 12 percent compared to the previous year.<\/p>\n<div class=\"shortcode post-related-videos\">\n<div class=\"lazyload-wrapper\">\n<div class=\"lazyload-placeholder\"><\/div>\n<\/div>\n<\/div>\n<p>Meanwhile, the surging \u2062home prices have deterred potential homebuyers from entering the housing market.<\/p>\n<p>&#8220;Last\u200d week&#8217;s\u200c decline was primarily driven by a 5 percent drop in refinance \u200capplications, reaching the lowest level since January 2023,&#8221;\u2064 stated Joel Kan, MBA&#8217;s Vice President and Deputy Chief Economist. &#8220;Despite the increase in rates, purchase applications increased over the week, \u200bfueled by a 2 percent rise in conventional loans. Given the current high rates, there is minimal \u2064refinance activity and less incentive for homeowners\u2064 to sell and purchase a\u200b new \u2064home at a higher rate,&#8221; Mr. Kan\u2063 added.<\/p>\n<p>The median home price now stands at $378,725, reflecting a 4.5 percent \u2062year-over-year increase and the most significant surge in costs since October 2022,\u2064 according to \u200bRedfin.<\/p>\n<p>The\u2062 rise in home prices can be attributed in part to the limited availability of homes, \u200cas many homeowners are\u2062 hesitant to sell\u200b their properties acquired during the period of <a href=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/mortgage-demand-hits-lowest-level-in-nearly-three-decades\/\" title=\"Mortgage demand at its lowest in almost 30 years.\">historically low mortgage rates<\/a>.<\/p>\n<p>Furthermore, the prevalence of more buyers than sellers in most U.S. housing markets exacerbates the situation.<\/p>\n<div class=\"my-5\">&#8220;The U.S. housing market is presenting a challenging environment for homebuyers, with escalating home values and\u200d interest rates. The cost\u2062 of homeownership has reached unprecedented levels. The combination \u200dof low inventory and high-interest rates is causing many potential homebuyers in various markets to\u200d continue renting instead,&#8221; explained \u200bColin O&#8217;Leary, Licensed Real Estate Salesperson with Berkshire Hathaway HomeServices Fillmore Real Estate \u200bin New York City, in an interview with The Epoch Times. <\/p>\n<h2>Household Mortgage Debt Surges in Q2\u200d 2023<\/h2>\n<p> Current mortgage debt continues to burden numerous homeowners, as\u200b mortgage\u200d balances surged by $627 billion annually in the second\u200c quarter of 2023, \u2062 <a href=\"https:\/\/www.newyorkfed.org\/newsevents\/news\/research\/2023\/20230808\" target=\"_blank\" rel=\"noopener\">according to<\/a> the \u2063Federal Reserve Bank of New York&#8217;s latest report.<\/div>\n<p>The total mortgage balances held by American homeowners now amount to $12.01 trillion.<\/p>\n<p>Simultaneously, <a href=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/biden-continues-to-push-his-bidenomics-agenda-voters-arent-buying-it\/\" title=\"Biden persists with Bidenomics, but voters remain unconvinced.\">total household debt reached <\/a>.06 trillion in the second quarter, increasing by $909 billion\u2063 annually.\u2064 The <a href=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/mortgage-application-volume-tumbles-to-lowest-levels-in-nearly-30-years-as-home-costs-soar\/\" title=\"Mortgage applications plummet to 30-year low amid surging home prices.\">rising household credit card debt<\/a> is a cause for concern among economists.<\/p>\n<p>In fact, U.S.\u200c credit card debt surpassed $1 trillion in the second quarter, \u2062experiencing a quarterly \u200cincrease of $45 billion. At least 5.08 percent of this \u2062debt ended up in delinquency or payments at least \u200d90 days\u2062 past due, marking an annual increase of 3.35 percent.<\/p>\n<div class=\"my-5\">According to the latest data from the St. Louis Fed, the average\u200c interest rate for a personal loan \u2063is 11.48 percent, significantly lower than the\u200c <a href=\"https:\/\/www.conservativenewsdaily.net\/breaking-news\/repos-and-foreclosures-on-the-rise-but-bidenomics-is-working\/\" title=\"Repos and foreclosures increasing, yet Bidenomics succeeds.\">average credit card interest rate<\/a> of\u2063 20.68 percent.<\/div>\n<div class=\"my-5\">&#8220;Credit cards remain \u200bthe most prevalent form of household\u2063 debt and continue to become even more widespread,&#8221; \u200cstated the NY Fed.\u200b &#8220;Consider that there \u2064are now 70 million more credit card accounts open than there were in 2019, before the pandemic.<\/div>\n<div class=\"my-5\">&#8220;Compared to other debt categories this \u2064quarter, credit card balances saw the most significant deterioration in performance, following a period of exceptionally low\u200b delinquency rates\u2064 during the pandemic.&#8221; <\/p>\n<h2>Latest Data May Influence Federal Reserve&#8217;s Actions on Inflation<\/h2>\n<p> &#8220;The Federal Reserve has essentially created a cycle of\u200d booms and \u200cbusts. We are perpetually trapped within these cycles,&#8221; remarked Phil Nicozisis, a real estate developer and investor, in an \u200binterview with The Epoch Times.<\/p><\/div>\n<p>&#8220;People tend to forget that\u2062 for 150 years, interest rates were governed by passbook savings. The ability to artificially set interest rates goes against the\u2064 basic principles of finance, which emphasize the importance of considering the price elasticity of supply and demand,&#8221; he added.<\/p>\n<p>Since March 2022, the Federal Reserve has raised interest rates 11 times in \u200can effort to curb inflation, resulting in\u200d higher\u200c mortgage rates.<\/p>\n<p>The Federal Open Market Committee\u2062 (FOMC) will determine whether to \u2063raise rates at its upcoming policy meeting\u200b scheduled\u200d between Sept. 19 and Sept. 20.<\/p>\n<p>Although the Fed managed to lower inflation rates from 9.1\u2062 percent in June 2022, prices have risen to 3.2 percent year-over-year in July, surpassing the central bank&#8217;s 2 percent target.<\/p>\n<p>Despite signs of cooling, the August\u200c jobs report still showed growth, with the addition of 187,000 jobs, surpassing most predictions.<\/p>\n<p>The U.S. unemployment rate rose to 3.8 percent in August, up from the 3.5 percent recorded \u2063in July.<\/p>\n<p>The\u200c combination of a \u2063sluggish housing\u200d market, ongoing\u2063 job growth, and a \u2062slight increase in inflation \u2063is \u200blikely to influence the Fed&#8217;s\u200d decision on whether to implement another round of\u2064 rate \u2064hikes.<\/p>\n<\/div>\n<\/blockquote>\n<p> <\/p>\n<h2> What are the implications of escalating household\u200d debt, specifically credit \u2063card debt, on the economy<\/h2>\n<p><span>  Inue to be a concern due to their high interest rates,&#8221;\u200b stated Brian O&#8217;Reilly, Director of Finance Education at the National Endowment \u200bfor Financial\u200c Education. &#8220;It&#8217;s important for consumers to be aware of their credit card balances and \u2062make efforts to pay them off in a timely\u200c manner to avoid excessive interest charges.&#8221;<\/div>\n<p>In conclusion, the mortgage application volume\u2062 has reached its lowest point in\u200b nearly \u2063three decades, primarily due \u2063to\u2064 the\u2064 surge in mortgage rates and home prices. The high cost of homeownership and limited availability of homes have deterred potential buyers from entering the market. Additionally, the escalating household debt, \u200cparticularly in the form of credit card debt, poses a significant concern \u2063for\u200c the economy. As the housing market continues to present challenges, both\u200b potential homebuyers and policymakers need to carefully navigate this complex\u2062 landscape.<\/p>\n<\/div>\n<\/blockquote>\n<p>  The Mortgage Market Slumps\u200c as Mortgage Payments Soar<\/p>\n<p>The mortgage application volume in the\u200c United<\/p>\n","protected":false},"excerpt":{"rendered":"<p>The mortgage application volume has reached a 30-year low due to record-high monthly mortgage payments. Redfin&#8217;s latest data reveals that with 7% 30-year mortgage rates in recent weeks, mortgage payments have surged to near-record levels. Additionally, the scarcity of homes has driven up prices.<\/p>\n","protected":false},"author":327,"featured_media":2035597,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_mo_disable_npp":"","fifu_image_url":"https:\/\/cndimages.nyc3.digitaloceanspaces.com\/breaking-news\/wp-content\/uploads\/2021\/01\/IMG_2758-scaled-1.jpg","fifu_image_alt":"","footnotes":""},"categories":[543],"tags":[],"class_list":["post-2035596","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-the-epoch-times"],"fifu_image_url":"https:\/\/cndimages.nyc3.digitaloceanspaces.com\/breaking-news\/wp-content\/uploads\/2021\/01\/IMG_2758-scaled-1.jpg","_links":{"self":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts\/2035596","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/users\/327"}],"replies":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/comments?post=2035596"}],"version-history":[{"count":0,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts\/2035596\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/media\/2035597"}],"wp:attachment":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/media?parent=2035596"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/categories?post=2035596"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/tags?post=2035596"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}