A surge in mortgage rates to 6% is giving home shoppers chills, pushing them to wait to refinance or buy a home.
With rates doubling from where they were a year ago, demand from buyers continues to weaken, as reflected in the Market Composite Index, a measure of mortgage application volume.
The index is now at its lowest level since December 1999, the Mortgage Bankers Association (MBA) said on Wednesday.
The market index fell 1.2% to 255 in the week ending September 9. A year ago, the index stood at 707.9.
The big picture: Rates hitting 6% is a significant milestone, albeit a negative one, for buyers. Mortgage rates are now at the highest level since November 2008.
Higher rates have pushed buyers to rethink refinancing and contributed to other prospective buyers’ staying on the sidelines, the MBA said.