Mortgage Demand Hits 1995 Low as Interest Rates Approach 8%

Mortgage demand has dropped to its lowest level since 1995 as interest rates continue to rise, reaching nearly 8%. Last week, total application volume fell by 6.9%, with applications for home purchases dropping by 6% and applications for refinancing falling by 10%. The average contract interest rate for 30-year fixed-rate mortgages increased to 7.70%, the highest rate since November 2000. As a result, more borrowers are turning to adjustable-rate mortgages (ARMs) to gain purchasing power. Mortgage rates have continued to rise this week, hitting a cyclical high of 7.92%.