Mortgage Applications Plunge to Lowest Level in 28 Years

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The Mortgage Bankers Association (MBA) on Wednesday reported the highest mortgage rates last week since late 2000, indicating the lowest demand in almost three decades.  The MBA’s index of home-purchase applications fell to the lowest level since 1995 after falling for six straight weeks, dragging the overall measure of mortgage applications further down.  MBA vice president and deputy chief economist Joel Kan said, “Applications for home purchase mortgages dropped to their lowest level since April 1995, as homebuyers withdrew from the market due to the elevated rate environment and the erosion of purchasing power. Low housing supply is also keeping home prices high in many markets, adding to the affordability hurdles buyers are facing.”  On Tuesday, the 30-year fixed rate hit almost 7.5%, according to Mortgage News Daily. With Federal Reserve officials seeing significant upside risks to inflation, more rate hikes may be required.