Demand for mortgage applications fell to its lowest level since 1996, according to a new report from the Mortgage Bankers Association (MBA).
Joel Kan, vice president and deputy chief economist of the MBA, said in a statement that lowering mortgage rates isn't enough to rebuild the market:
Mortgage applications declined to the lowest level since December 1996, despite a drop in mortgage rates. Both purchase and refinance applications fell...
In weekly terms, mortgage loan applications fell by 2.9% compared to the previous week:
The Market Composite Index, a measure of mortgage loan application volume, decreased 2.9 percent on a seasonally adjusted basis from one week earlier.
Purchase and refinance applications are also down
Kan revealed that the Purchase Index also hit its lowest level in 28 years "as prospective buyers remain on the sidelines due to low housing inventory and elevated mortgage rates." Compared to last week, the index also decreased by 5%.
The study, based on a survey, also showed that the Refinance Index is 30% lower than in 2022. The index fell 5% in the last week:
The refinance index dropped to its lowest level since January 2023, driven by a 6 percent decline in conventional refinances.
The survey covers more than 75% of all U.S. retail residential mortgage applications and has been conducted weekly since 1990, the Association said.