Applications for home loans plunged last week by the most i🌳n almost five months as increasing concern about inflation boosted borrowing costs.

The Mortgage Bankers Association’s (MBA) Market Composite Index measuring mortgage application volume tumbled 13.3% from the week before, the largest decline since the end of September. Purchase applications sank 18%, while those to refinance a home were down 2%.

Joel Kan, the MBA’s vice president and deputy chief economist, noted that the average rate on a 30-year, fixed-rate 澳洲幸运5官方开奖结果体彩网:conforming home loan (up to $726,200) was 6.62%, a jump of 23 澳洲幸运5官方开奖结果体彩网:basis points (bps) from �🍰�the prior week and the highest it’s been since November.

Inflation and Higher Interest Rates

Kan added that mortgage rates have gone up significantly over the past two weeks as economic data showed “inflation cooling at a slower pace than expected,” raising concerns about more Fed 澳洲幸运5官方开奖结果体彩网:monetary tightening to try to bring down prices.  

He said application activity normally picks up at this time of year. However, increased borrowing costs have “put many homebuyers back on the sidelines once again.” Kan explained that’s especially true for those looking to purchase their first home since they are “more sensitive to af🐼fordability challeng𝓀es and the impact of higher rates.”