Mortgage Demand Plummets as FHA Loan Interest Rates Reach 21-Year High

Mortgage demand has dropped by 3.1% as the interest rate on FHA loans, favored by first-time or lower-income borrowers, reached its highest level in 21 years. The average contract interest rate for 30-year fixed-rate mortgages also increased, making it harder for potential buyers to afford homes and discouraging current homeowners from moving. Applications for both home purchases and refinancing have declined, with rates expected to see a significant impact following the release of monthly inflation data.