It seems that the mortgage market is slowing down, with demand for new mortgages reaching its lowest level since 1995. According to recent reports, the number of people applying for new mortgages dropped to its lowest level since 1995. This is due to a number of factors, including rising interest rates and declining housing prices. The number of mortgage applications fell by 9.5 percent in October, the largest drop since October 2016.
This drop in demand could be attributed to several different factors. First, the Federal Reserve recently raised interest rates, making it more difficult for people to qualify for mortgages. The average rate for a 30-year fixed rate mortgage now stands at 4.85 percent, its highest level since January 2014. This increase in interest rates can make it harder for people to qualify for a mortgage, as it makes the monthly payments more expensive.
Second, housing prices are declining in many parts of the country. Over the past year, the median home price in the US has fallen by more than 3 percent. This decrease in home prices may make potential buyers think twice about purchasing a home, as it represents a significant amount of money to commit to a single purchase.
Finally, there is a general slowdown in the US economy. GDP growth has been slipping since September, with some economists predicting a potential recession in 2020. This slowdown in economic activity may cause individuals to put their purchases on hold, as they wait to see how the economy will fare in the future.
The decline in mortgage demand is concerning, as it could be indicative of a broader economic slowdown. It remains to be seen what impact rising interest rates, declining housing prices, and a potential recession have on the housing market. With demand for mortgages at its lowest level since 1995, it may take some time for the market to recover.