Weekly mortgage applications drop 10% as economic worries grow
Mortgage applications dropped as mortgage rates — and concerns over the economy — continue to climb
David Paul Morris/Bloomberg via Getty Images
Weekly U.S. mortgage applications dipped 10% for the week ending July 11 as the economy becomes more turbulent and mortgage rates rise, according to a survey published Wednesday.
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Refinancing and purchasing applications also dropped 7% and 12% respectively, according to the Mortgage Bankers Association’s Weekly Mortgage Applications Survey. The rates are seasonally-adjusted and are compared to the week prior.
“Treasury yields finished higher last week on average despite an intra-week drop, driven partly by renewed concerns of the impact of tariffs on the economy. As a result, mortgage rates rose after two weeks of declines, which contributed to slower application activity,” MBA’s Vice President and Deputy Chief Economist Joel Kan said in the survey release.
He added that purchasing applications also “remained sensitive” to the “uncertain economic outlook” and “volatility in rates.” Kan said purchasing applications dropped to their “slowest pace since May.” Refinancing applications also fell because of higher rates, Kan said, with VA refinances leading the fall with a 22% drop.
Contract interest rates for 30-year fixed-rate mortgages with conforming loan balances — properties that cost $806,500 or less — rose on average to 6.82% from 6.77%. The same rates for 30-year fixed-rate mortgages with jumbo loan balances — properties that cost more than $806,500 — rose on average to 6.75% from 6.69%, the survey said.
“Jumbo rates were lower than conventional rates for the third straight week, as some depositories may be positioning themselves for growth in balance sheet lending,” Kan said in the release.
Dips in mortgage applications are on par with findings for the rest of the housing market. Delistings increased by nearly 50%, according to a June survey, as sellers see little activity. The same survey found that prices for more than 1 in 5 listings were reduced in June.
Rising interest rates, home prices, and home inventory across the country are not boding well for buyers or sellers. This latest mortgage application data is another indicator of what the market already knows — buyers aren’t buying.