US mortgage rates swing back up amid volatile market

“The combination of higher mortgage rates and the slowdown in economic growth is weighing on the housing market,” said Sam Khater, Freddie Mac’s chief economist. “Home sales continue to decline, prices are moderating, and consumer confidence is low. But, amid waning demand, t. are still potential homebuyers on the sidelines waiting to jump back into the market.”

Mortgage applications for the week ending August 19 dwindled 1.2% week over week on a seasonally adjusted basis, according to the Mortgage Bankers Association. Refinance application activity was down 3%, and purchase application volume dropped 1% from the prior week.

Read next: Mortgage applicants get slight reprieve from steep loan payments

“Mortgage applications continued to remain at a 22-year low, held down by significantly reduced refinancing demand and weak home purchase activity,” said Joel Kan, AVP of economic and industry forecasting at MBA. “Last week’s purchase results varied, with conventional applications declining 2% and government applications increasing 4%, which is potentially a sign of more first-time homebuyer activity.”