Mortgage Application Demand Lowest Since Summer 2009

An ever changing scenery

We’re certainly still in uncertain times and after six months of increasing demand for mortgage applications, this week, the Mortgage Bankers Association reports that application rates are now at their lowest point in six months.

The total mortgage loan application volume (seasonally adjusted) is down 22.3% and refinance applications accounted for 62.8% of all loan applications.

Some might attribute the lack of interest to the holidays, others might note a continued slew of bad news leading to a perception issue with buyers. Regardless, demand could go back up throughout the buyers’ tax credit extension, expiring this spring despite mortgage rates rising.

Pending home sales are down and mortgage application volume is down, both at levels lower than forecasted. Are we experiencing a slow down in the market on top of a slow market?

Will Uncle Sam have to create another bailout mechanism aside from tax credits and buying mortgage backed securities or will Associations like the National Association of Realtors and National Association of Home Builders find ways to move the market?