Overall demand for mortgages fell by 2% during the week of August 10, bringing demand to the lowest levels that they have been since 2000. This represents an overall cooling of the market that has brought mortgage rates down over the past few weeks, despite rising interest rates.
Looking at the Statistics
The amount of mortgage applications dropped by 2% during the second week of August, including a 1% drop in mortgage applications for new homes. This represents an overall 18% drop in mortgage applications compared to the same time last year, despite lower rates in the month of August. People looking to refinance their mortgages have also been impacted due to higher interest rates, with applications for refinancing down 5% for the week and down 82% compared to the same time last year.
Why The Market is Cooling
The statistics, overall, point to a cooling real estate market where buyers are more reluctant about buying new homes or refinancing their old homes. Although mortgage rates have been falling most recently, they are still substantially higher than they were even one year ago, due in large part to rising interest rates. People are also less likely to refinance their mortgages due to higher interest rates, which makes refinancing inadvisable, especially considering closing costs, and the amount of time it would take to realize refinance savings.
The Real Estate Market in the Near Future
Although interest rates have been rising dramatically over the last few months, there is some speculation that this may not continue as inflation has started to flatten out. This could help to bring the cost of mortgages down to a point where they are more affordable, encouraging new buyers. Nationally, the overall real estate market has cooled despite increases in inventory and home prices that have begun to fall.
What This Means for You
If you are looking to buy a new home, now may not be a bad time. Mortgage rates are on the decline, and a relative lack of competition means you may be able to get a home for less than you would have even a few months ago. Sellers, meanwhile, may struggle to find good bids for their homes in the current market. Fortunately, however, there are always people looking to purchase homes, and if you are looking to sell, Liongate Homebuyers may offer an excellent opportunity for you.
At Liongate Homebuyers, we assist our clients with a variety of services related to buying and selling real estate, including purchasing homes for cash. We have experience handling real estate financing, especially for developers and house flippers. If you are interested in selling your home for cash, please contact us at 516-548-6553, or visit our contact page.
