{"id":73044,"date":"2023-10-16T02:31:41","date_gmt":"2023-10-16T06:31:41","guid":{"rendered":"https:\/\/ifintechworld.com\/markets\/climbing-mortgage-rates-are-keeping-home-buyers-away-brace-for-another-hit\/"},"modified":"2023-10-16T02:31:44","modified_gmt":"2023-10-16T06:31:44","slug":"climbing-mortgage-rates-are-keeping-home-buyers-away-brace-for-another-hit","status":"publish","type":"post","link":"https:\/\/ifintechworld.com\/?p=73044","title":{"rendered":"Climbing Mortgage Rates Are Keeping Home Buyers Away. Brace for Another Hit."},"content":{"rendered":"<div id=\"js-article__body\" itemprop=\"articleBody\" data-sbid=\"WP-BAR-0000769490\">\n<div data-layout=\"wrap\n              \" data-layout-mobile=\"\" class=\"\n        media-object\n        type-InsetMediaIllustration\n          wrap\n  article__inset\n        article__inset--type-InsetMediaIllustration\n          article__inset--wrap\n    article__inset--lead\n  \"><\/p>\n<p>        <!-- eventually when we know what this card will be we can change it and leave this one --><\/p>\n<figure class=\"\n        media-object-image\n        enlarge-image\n        img-wrap\n        article__inset__image\n      \" itemscope=\"\" itemtype=\"http:\/\/schema.org\/ImageObject\"><\/p>\n<\/figure><\/div>\n<p>Existing-home sales data for September, set for release this week, is expected to show that sales slumped to the lowest level in more than a decade as mortgage rates rose. More bad news could be around the corner.\u00a0<\/p>\n<p>Rising rates have weighed on everything from housing market sentiment to mortgage applications in recent weeks. Mortgage rates measured by<br \/>\n        Freddie Mac<br \/>\n      \u2018s weekly gauge quickly rose past 2022\u2019s high of 7.08% in mid-August\u2014and largely kept climbing. The average mortgage rate last week was 7.57%, Freddie Mac said, the highest since late 2000.\u00a0<\/p>\n<div class=\"paywall\">\n<p>Quickly-rising rates pushed home sales in August to their lowest level since January, the National Association of Realtors said last month. Because of the time it takes to close on a home, it\u2019s likely that the anemic home sales figure reported in August represent properties that went under contract earlier in the summer\u2014meaning the full brunt of the mortgage rates\u2019 rise above 7%, and their continued climb into mid-October, has yet to appear in the monthly report.\u00a0<\/p>\n<p>That\u2019s likely to change with the release of September\u2019s report, expected on Thursday. Economists polled by FactSet expect existing-home sales to drop 3.5% to the lowest level since October 2010. Should the expectations come to pass, it will be the greatest month-over-month decline since November 2022, when rising rates similarly snuffed out buying activity.<\/p>\n<p>Leading data has already shown how higher rates are weighing on home buyers. Only 16% of respondents to<br \/>\n        Fannie Mae<span>\u2019s<\/span><br \/>\n       September housing market sentiment survey said it was a good time to buy a house. Such a reading is tied with October and November 2022 for the lowest share in the question\u2019s history, which dates back to 2010.\u00a0<\/p>\n<p>That\u2019s translated into a low level of mortgage applications, a leading indicator of future home sales. Home loan application volume released every week by the Mortgage Bankers Association has remained near multidecade lows as fixed mortgage rates have risen, according to the trade group.\u00a0<\/p>\n<p>It isn\u2019t just buyers feeling down about the housing market these days: the sour mood has spread to builders as well. Industry sentiment gauged by the National Association of Home Builders turned pessimistic in September after four months of neutral or optimistic readings, the trade group\u2019s data show. Economists expect another pessimistic reading when the October result is released on Tuesday.\u00a0<\/p>\n<p>Investors in home builders have had a rocky run in recent weeks as Treasury yields and mortgage rates have risen. Two exchange-traded funds tracking the home builders and related industries, the<br \/>\n        SPDR S&amp;P Homebuilders<br \/>\n      ETF (XHB) and the<br \/>\n        iShares U.S. Home Construction<br \/>\n       ETF (ITB), have fallen about 12% and 14% over the past six weeks, according to Dow Jones Market Data. The ETFs, which had a strong run earlier this year as prospective buyers turned to new homes amid a dearth of previously owned homes for sale, have both returned about 25% year to date.<\/p>\n<p>Builder shares have underperformed in recent weeks, but rising mortgage rates weighing on buyer demand is nothing new. In a note last week titled, in part, \u201cLooking to 2024, Deja Vu from 2H22?\u201d JPMorgan analyst Michael Rehaut wrote that he sees further upside for the industry in 2024. Larger-cap builders\u2019 earnings per share will grow by double digits, he wrote, in spite of headwinds such as the recent rise in interest rates and anticipated economic slowing.<\/p>\n<p>\u201cWhile not nearly approaching the same level of disruption due to today\u2019s lesser move in rates, we see some level of comparison to 2H22, when the builders also pulled back amid similar (albeit more magnified) investor concerns ahead of ultimately a rebound in fundamentals and the stocks in 2023,\u201d wrote Rehaut, who reiterated his Overweight ratings on<br \/>\n        PulteGroup<br \/>\n       (PHM),<br \/>\n        Toll Brothers<br \/>\n      (TOL),<br \/>\n        Meritage Homes<br \/>\n       (MTH) and<br \/>\n        Taylor Morrison Home<br \/>\n       (TMHC).<\/p>\n<p>Write to Shaina Mishkin at shaina.mishkin@dowjones.com<\/p>\n<\/p><\/div>\n<\/div>\n<p>Read the full article <a href=\"https:\/\/www.marketwatch.com\/articles\/climbing-mortgage-rates-are-keeping-home-buyers-away-brace-for-another-hit-3fe2d7d?mod=markets\" target=\"_blank\" rel=\"noopener\">here<\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Existing-home sales data for September, set for release this week, is expected to show that sales slumped to the lowest level in more than a decade as mortgage rates rose. More bad news could be around the corner.\u00a0 Rising rates have weighed on everything from housing market sentiment to mortgage applications in recent weeks. Mortgage [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":73045,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"gallery","meta":{"footnotes":""},"categories":[241],"tags":[83],"class_list":["post-73044","post","type-post","status-publish","format-gallery","has-post-thumbnail","hentry","category-markets","tag-featured","post_format-post-format-gallery"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v20.6 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Climbing Mortgage Rates Are Keeping Home Buyers Away. 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