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HomeLatest NewsUS mortgage rates climb to 23-year highs and sink demand

US mortgage rates climb to 23-year highs and sink demand

Date: April 12, 2024 Time: 20:46:29

The interest rate applied to fixed-rate mortgage loans with a term of 30 years stood at 7.31% last week, its highest level since December 2000, while the demand for mortgages for the acquisition housing plunged to its lowest since April 1995, according to data from the Mortgage Bankers Association (MBA).

“Home purchase mortgage applications fell to their lowest level since April 1995 as buyers withdrew from the market due to the high-rate environment and eroding purchasing power,” said Joel Kan, vice president and economist deputy head of MBA.

In this sense, the expert explained that, while the mortgage rate at a fixed rate and a term of 30 years increased to 7.31% last week, “the highest level since December 2000”, the low supply of homes is also it keeps prices high in many markets, adding to the barriers buyers face in accessing home ownership.

This Wednesday, the Department of Housing and Urban Development reported that sales of new single-family homes reached an annualized figure of 714,000 units in July, 4.4% more than in June and 31.5% more than in 2022.

Likewise, the average sale price reached 436,700 dollars (401,356 euros) and the average price 513,000 dollars (471,481 euros), which implies a reduction of 8.7% and 9.2% in one year.

On the other hand, sales of second-hand homes in the United States registered a drop of 2.2% in July compared to the previous month and 16.6% in one year, to an annualized figure of 4.07 million. , according to data from the National Association of Realtors (NAR).

“Two factors are driving current sales activity: inventory availability and mortgage rates,” said NAR chief economist Lawrence Yun. “Unfortunately, both have been unfavorable to buyers,” he added.

In this sense, the inventory of second-hand homes for sale registered at the end of July was 1.11 million units, 3.7% more than in June, but 14.6% less than a year ago. In this way, the inventory would cover the supply of 3.3 months at the current sales rate.

On its side, the median price of used homes for all types of housing reached $406,700 (373,423 euros) in July, an increase of 1.9% since July 2022, compared to 3.1 months in June and 3.2 months in July 2022.

* This website provides news content gathered from various internet sources. It is crucial to understand that we are not responsible for the accuracy, completeness, or reliability of the information presented Read More

Puck Henry
Puck Henry
Puck Henry is an editor for ePrimefeed covering all types of news.
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