Categorized | Finance and Mortgage

United States Sees Another Decline in Mortgage Applications

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Although mortgage loan rates are at historically low levels, many potential homebuyers are simply opting to stay away from the housing market. The most recent report indicates that the overall volume of mortgage applications dropped more than one percent in the past week.

The numbers shed light on the continued struggle faced by the real estate market, as demand continues to dwindle due to economic uncertainty and lending restrictions. Increasing down payment requirements have made it incredibly difficult for the average person to become a homeowner in the current market.

There has been no clear indication as to when the current stringent lending restrictions will be eased. Until there is some loosening of the restrictions, however, it is unlikely that market will experience a large growth of new homeowners any time in the near future.

Analysts believe that mortgage applications may continue to drop, as more potential homeowners opt to rent. Although it is currently a buyer’s market in the residential real estate sector, the current lending standards have made it essentially impossible for most buyers to take advantage.

There has been no clear indication as to whether or not lending restrictions will ease up in the next year. Analysts believe that the loosening of the stringent standards, though, will be necessary to stimulate a renewed interest among homebuyers. The volume of mortgage applications will likely continue to decline until both banks make borrowing more viable, and the job market shows remarkable improvement. Without those changes, the overall public interest in the housing market will further dwindle.

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About Ella Jourgeson

Ella was recently an intern who checked all the articles for grammatical and spelling errors. She is now an all purpose writer filling in wherever we need help.

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