In This Article:
Mortgage applications fell by 6.2% in the week ending on March 14, as reported by the Mortgage Bankers Association (MBA).
Yahoo Finance senior housing reporter Dani Romero comes on Wealth to comment on how elevated mortgage rates are still weighing on prospective homebuyers and what they mean for long-term affordability challenges.
To watch more expert insights and analysis on the latest market action, check out more Wealth here.
Mortgage applications declined 6.2% from the week prior, according to the Mortgage Bankers Association. Here to put that data in context and explain what it means for the housing market, we've got Yahoo Finances, Danny Romero. Hey Danny.
Mortgage demand pulled back last week due to interest rates and the economic uncertainty, which is rattling the housing market. I mean, Mortgage Bankers Association reported that total mortgage application volume dropped 6.2% from the previous week. And mortgage applications to purchase a home were flat, but they were 6% higher than the same week a year ago. So, there is a lot of inventory out there and mortgage rates still remain steady around that 6.6%. And so that could be a supportive dynamic as we enter this spring selling season. Separately, Wells Fargo's, Wells Fargo's economists say that mortgage rates will remain elevated. They are expecting that mortgage rates will be around 6.9% at year end. So, that means that affordability could be still challenged at the end of the year.
Danny, there's a new report from realtor.com today that says fewer multi-family permits today could mean costlier rents ahead. So, kind of put this in context for us.
So, what's happening in the rental market is that apartment hunters caught a break in February as rents continued to move downwards. So, data from realtor.com shows that rents dropped to $1,691 last month. This marks the 19th consecutive month of year over year declines. So, remember rents have been trending downward for well over a year and a half since the pandemic, pandemic run-up. But renters are still paying a lot more than they used to be. Uh, there is a catalyst that is really important to factor into this rental market. Construction for apartments has pulled back since last year. So, we could see rents push higher. We don't, I mean, I think when we take a look at this realtor.com data, I think it's still unknown how much we will see, but we have seen this pull back in construction. So, if there's not a lot of inventory in the future, yes, where, where is the demand going to go, right? So, it's still, I think a wait and see to see what could happen, but we already, we are already seeing it in the data that there is not a lot of inventory for multifamily. Now, we're not talking about single family.
Certainly. Danny, thanks so much for breaking down some of the data. Appreciate it.