Despite fears that home sales will keep sinking in 2023, mortgage applications rose sharply last week. We’ll be referencing this article from Yahoo! Finance.
Mortgage applications for the week ending Jan. 13, 2023, rose a whopping 27.9% from the prior week, according to data released Wednesday by the Mortgage Bankers Association (MBA). The uptick was due to a combination of falling mortgage rates and the normal post-holiday rise in applications.
The housing market has been in a months-long slump because of historically high home prices and mortgage rates that have more than doubled over the past year. Home sales in November 2022 fell for the 10th month in a row — the longest such streak since 1999.
As far back as August, the National Association of Homebuilders (NAHB) said the U.S. was in a “housing recession,” citing a slowdown in home sales, mortgage applications and single-family starts.
What does this mean for the market?
Despite the recent surge in mortgage applications, most housing experts see a tepid market in the months ahead. As GOBankingRates reported, some observers believe the playing field will be evenly balanced between buyers and sellers in 2023 after sellers held all the best cards during the previous couple of years.
One problem facing the U.S. housing market is an ongoing lack of available homes for sale. Redfin estimates that active listings are up about 21% from a year ago, CNBC reported. But that’s mostly because homes are sitting on the market longer. Meanwhile, sales continue to decline, while new home listings are down 22% year over year.