It’s becoming very clear that rising mortgage rates are having a material impact on the housing a market.
The Mortgage Bankers Association’s (MBA) latest weekly survey of mortgage applications showed plunging numbers across the board.
Mortgage applications for the week ending September 6 fell 13.5% from a week ago. This is a five-week low.
Refinancing activity plunged 20% to its lowest level since June 2009.
The average 30-year conforming fixed mortgage rate ($417,000 or less) climbed to 4.80% from 4.73% a week ago.
The average 30-year fixed mortgage rate with jumbo loans climbed to 4.84% from 4.71% a week ago.
“Housing is not the economic tailwind it used to be,” said fund manager Jeffrey Gundlach in a webcast on Tuesday evening.
Interest rates began to rise in May when the Federal Reserve said it could soon taper its monthly purchases of $US45 billion worth of Treasury securities and $US40 billion worth of mortgage backed bonds.