Meanwhile, Christophe Barraud, Bloomberg’s top forecaster, shared a tweet indicating that the mortgage refinancing index fell again, for the fifth straight week, reaching levels last seen in October 2000. Moreover, the index declined by 4% compared to the previous week, and compared to the previous year, the index is down 83%, with the refinancing share of mortgage activity decreasing by 30.2% of total applications, according to the Mortgage Bankers Association (MBA).
Homebuyers on the sidelines
With the economy clouded by numerous worries, internet data shows that more people are looking to sell their homes; however, homebuyers seem to be on the sidelines due to higher mortgage rates. Joel Kan, MBA Associate Vice President of Economic and Industry Forecasting, shared his view of the market.
A bright spot in a slow market
On the other hand, government-sponsored loan programs seem to be garnering more attention, as they provide financing to first-time buyers. The seasonally adjusted government index rose by 0.2% on a weekly basis, boosting purchases and refinancing. Similarly, the increase in government loans reduced the size of purchase loans from the previous week from $411,300 to $405,000. With the tighter squeeze by rising interest rates, the mortgage refinancing index could see more downside, indicating more pain for the broader economy. In addition, housing prices could come down more than they have over the previous month. Buy stocks now with Interactive Brokers – the most advanced investment platform Disclaimer: The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk.
