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Mortgage demand drops to a 22-year low as higher interest rates and inflation crush buyers
Posted on 7/20/22 at 7:04 am
Posted on 7/20/22 at 7:04 am
quote:
Mortgage demand drops to a 22-year low as higher interest rates and inflation crush homebuyers
LINK
The pain in the mortgage market is only getting worse as higher interest rates and inflation hammer American consumers.
Mortgage demand fell more than 6% last week compared with the previous week, hitting the lowest level since 2000, according to the Mortgage Bankers Association's seasonally adjusted index.
Applications for a mortgage to purchase a home dropped 7% for the week and were 19% lower than the same week in 2021. Buyers have been contending with high prices all year, but with rates almost double what they were in January, they've lost considerable purchasing power.
17
Posted on 7/20/22 at 7:07 am to goofball
House is on the market right now. Wonderful. Looking like I’ll be renting it out.
Posted on 7/20/22 at 7:08 am to goofball
What I have not seen addressed is the fact that there are millions of homeowners paying for their existing homes at 3% or so fixed rate and probably don't want to move and have to give up that attractive low rate they currently have.
Posted on 7/20/22 at 7:10 am to goofball
I find this post offensive, and I'd like it removed post-haste. Who do I contact to have it removed? What's the number for management? How do I contact Mr. Chicken?
(I'm currently finishing up a home build and will be shopping around for the "best" rate soon.)
(I'm currently finishing up a home build and will be shopping around for the "best" rate soon.)
Posted on 7/20/22 at 7:11 am to East Coast Band
quote:
What I have not seen addressed is the fact that there are millions of homeowners paying for their existing homes at 3% or so fixed rate and probably don't want to move and have to give up that attractive low rate they currently have
Ding ding. We locked in at 2.8%. Told my wife she better like the house we're in because we're not moving for a long time.
Posted on 7/20/22 at 7:12 am to East Coast Band
quote:
What I have not seen addressed is the fact that there are millions of homeowners paying for their existing homes at 3% or so fixed rate and probably don't want to move and have to give up that attractive low rate they currently have.
I'm curious what happens if enough of these people moved for Covid-related WFH that is now becoming more rare. There was a lot of movement, especially away from big/urban areas. I wonder how many people get "stuck".
Posted on 7/20/22 at 7:16 am to goofball
You know the situation is getting precarious when local realtor groups start doing interviews talking about the strength of the market in the local paper, and I think my local business journal has run 3-4 pieces like that this month alone.
Posted on 7/20/22 at 7:19 am to goofball
The mortgage industry slowed months ago but it hasn't crushed anyone and is just "the sky is falling" reporting. I know people in the mortgage business and they are still busy underwriting loans and I think people are mostly adjusting the amount of their purchase price to account for the rate increases.
Posted on 7/20/22 at 7:19 am to SlowFlowPro
quote:
I wonder how many people get "stuck".
I used the situation to get unstuck. Got out of a lot of bad debt and am no longer tied to an area. My house had no business selling for as high as it did
Posted on 7/20/22 at 7:21 am to goofball
Rates 22 years ago wasn't fun or free. Maybe this type of decision will make some more fiscally smart overall. Getting my first mortgage at 6.125 was a growing up experience.
Posted on 7/20/22 at 7:21 am to East Coast Band
quote:
What I have not seen addressed is the fact that there are millions of homeowners paying for their existing homes at 3% or so fixed rate and probably don't want to move and have to give up that attractive low rate they currently have.
Me currently. About to get married and hopefully start a family, and had hopes of moving into something a littler bigger than what I have. Now I'm stuck here with no clue when that time will come.
Posted on 7/20/22 at 7:23 am to goofball
I keep saying this.
The market will turn and no, house prices won’t fall off a cliff but they will go down to correct itself.
And when they do, all these people in the last year to two years that rushed out to buy houses are gonna be crying all over social media about how now their house won’t even appraise for what they bought it for.
But by all means, continue to listen to “it’s just the market we are in” and also how you need to offer 20k over appraisal value to get the house.
The market will turn and no, house prices won’t fall off a cliff but they will go down to correct itself.
And when they do, all these people in the last year to two years that rushed out to buy houses are gonna be crying all over social media about how now their house won’t even appraise for what they bought it for.
But by all means, continue to listen to “it’s just the market we are in” and also how you need to offer 20k over appraisal value to get the house.
Posted on 7/20/22 at 7:26 am to East Coast Band
quote:
What I have not seen addressed is the fact that there are millions of homeowners paying for their existing homes at 3% or so fixed rate and probably don't want to move and have to give up that attractive low rate they currently have.
Doesn't really matter when new homes have been built like hotcakes all over the country. Signed a contract on one of the first lots in our neighborhood over a year ago before lumber went crazy. Same floorplan now is 15% more. No way in hell people about to close with that high price are going to recoup that home value any time soon.
We closed before the interest rates started climbing again too. Someone was looking out for us with our timing.
This post was edited on 7/20/22 at 7:30 am
Posted on 7/20/22 at 7:26 am to BruslyTiger
quote:
and I think people are mostly adjusting the amount of their purchase price to account for the rate increases
Sure but you are also forgetting that lumber has tripled at some points and is still more than double what it was just 2 years ago. You can adjust what you can afford only so much before there's no desirability left. The price per sq ft is not going to come down much until lumber does. Rates have had little effect on lumber prices as lumber has started going back up recently due to fuel prices. Until there is a balance, new homes will still be out of reach for many as will remodeled homes.
If people were smart they would buy fixer uppers but hardly any young people want that. They want a house ready for social media to impress their friends.
This post was edited on 7/20/22 at 7:45 am
Posted on 7/20/22 at 7:29 am to Crowknowsbest
quote:
You know the situation is getting precarious when local realtor groups start doing interviews talking about the strength of the market in the local paper, and I think my local business journal has run 3-4 pieces like that this month alone.
All the pro real estate news you hear is basically the small time investors trying to reassure themselves they aren’t about to get crushed.
Unfortunately it’s going to get bad.
Posted on 7/20/22 at 7:30 am to goofball
The timing of my wife and I selling our apartment in NYC and buying a bigger house than we need is probably one of my biggest wins in the past few years.
Posted on 7/20/22 at 7:32 am to goofball
Market is still hot in our area. I wish I could sell. 2 acre lot in my neighborhood that was for sale 2 years ago at $75K, just sold last week after 2 days on the market for $125. Insane.
Affordable housing is the main issue here, there are none for first time homebuyers.
Affordable housing is the main issue here, there are none for first time homebuyers.
Posted on 7/20/22 at 7:33 am to stout
A fixer upper with sky high lumber prices. Sounds awful.
Posted on 7/20/22 at 7:34 am to stout
quote:
If people were smart they would buy fixer uppers but hardly any young people want that. They want a house ready for social media to impress their friends.
I don't see people bragging about houses on social media.
I don't want a fixer upper because I literally don't have the time to manage that. Plus, most fixer upper opportunities are next to people in neighborhoods that need a lot more of it. I don't want a fixer upper if my neighbors are living in shanties.
Posted on 7/20/22 at 7:42 am to dyslexiateechur
We are waiting on a closing date, praying to get it over with quickly, we had some paperwork issues on our end & had to delay process, really want to get it done before buyer gets upset
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