(Bloomberg) -- A gauge of U.S. mortgage applications tumbled last week to the lowest level since late 2018, illustrating the hit to the housing market from mortgage rates that are now approaching a 13-year high.
The Mortgage Bankers Association’s index of total applications dropped 8.3% in the week ended April 22 to 343.1, the Washington-based group said Wednesday.
A gauge of refinancing decreased 9% to the lowest level since December 2018, while purchase applications fell 7.6% to the weakest reading in nearly two years.
The average contract rate on a 30-year fixed mortgage jumped another 17 basis points to 5.37%, the highest since August 2009. The rate has climbed 1.22 percentage points in just the last eight weeks. Since the end of last year, rates have increased more than two percentage points. The effective rate, which includes the effects of compounding, rose to 5.56%.
The survey covers over 75% of all U.S. retail residential mortgage applications.
©2022 Bloomberg L.P.
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