The continued rise in mortgage rates is putting a wet blanket over several areas of the mortgage market.
Requests for mortgage applications declined 1.7% from the prior week, according to the weekly survey by the Mortgage Banker's Association.
"Mortgage rates increased for the 10th consecutive week, with the 30-year fixed rate reaching 7.16 percent, the highest rate since 2001," said Joel Kan, MBA’s vice president and deputy chief economist.
"The ongoing trend of rising mortgage rates continues to depress mortgage application activity, which remained at its slowest pace since 1997," continued Kan.
The higher rates for loans are affecting other parts of the mortgage market as well.
The Refinance Index increased fractionally from the previous week.
"Refinance applications were essentially unchanged, but purchase applications declined 2 percent to the slowest pace since 2015 – over 40 percent behind last year’s pace," added Kan.
The MBA’s forecast expects both economic and housing market weakness in 2023 to drive a 3% decline in purchase originations, while refinance volume is anticipated to decline by 24%, according to Kan.
The survey covers over 75% of all U.S. retail residential mortgage applications and has been conducted weekly since 1990.