Interest Rates Have Stalled — Is the Housing Market Slowing Down, Too?

After reports of great housing prices for home buyers in the pandemic, a mortgage rate stall this month has caused borrowers to pull back a bit. Even though mortgage rates are approaching historic lows, borrowers are choosing to find ways to lower their mortgage payments — especially by refinancing, causing demand to fall 4% over the last week, according to a report on the Mortgage Bankers Association Index by CNBC.

Although the volume of home refinance applications registered 30% higher than a year ago, that annual comparison has been shrinking over the past few months. Mortgage applications fell 1% last week — though compared to last year, they’re up 6%. That annual comparison is the smallest since mid-May, falling from gains in the 20% range over the past few weeks, according to the CNBC report.

“It’s not that they [lenders] don’t want to drop rates. It’s that they don’t have the capacity to fulfill that mortgage request right now, on the refis [refinance applications] especially,” Jeff Taylor, managing partner at Digital Risk, a Florida-based financial mortgage analytics company, told Yahoo Finance’s The Final Round. Once lenders catch up, mortgage rates are likely to decline again.

More from GOBankingRates

• 44 Ways To Trim Your Living Expenses During the Coronavirus Quarantine
• 94 Money-Making Skills You Can Learn in Less Than a Year
• 24 Ways To Maximize Your Paycheck This Year
• How Long $1 Million in Savings Will Last in Every State