21 July. (Reuters) – US home mortgage applications fell last week as both refinancing and buying activity declined due to rising mortgage rates.
The Mortgage Bankers’ Association (MBA) said Wednesday that its market-adjusted index fell 4.0% in the week ended July 16, compared with a week earlier. This reflected a 2.8% decline in applications to refinance existing loans, while purchase applications declined 6.4% to their lowest level since May 2020.
The average contractual interest rate on traditional 30-year mortgages increased to 3.11% from 3.09% in the previous week. Last week, the average contract rate fell to its lowest level since February.
“Limited stocks and higher prices are keeping some potential home buyers out of the market,” Joel Kahn, MBA’s deputy vice president of economic and industry forecasting, said in a statement.
“Refinancing activity declined over the week, but as rates remained relatively low, filing rates were close to their highest level since early May 2021,” the statement said.
This week’s data is due just a day after the Commerce Department reported that housing construction began accelerating in June and building permits fell to an eight-month low.
In addition, builder confidence in the US fell to an 11-month low in July due to both supply and labor shortages.
“While construction companies are working to balance the cost of returning timber to the land with rising labor and development costs, the market shortage of around 4.0 million homes remains an obstacle that has yet to be overcome,” said George Ratiu. Senior Economist at Realtor.com.
“Millions of buyers are willing and able to purchase, if only they can find a suitable home at an affordable price.” (Reporting by Evan Sully; editing by Peter Cooney)