Mortgage Rates Surge to 8% as Demand Hits Record Low

Mortgage rates in the US have surged to their highest level since 2000, causing a sharp decline in home-purchase applications, which fell to a nearly three-decade low. The Mortgage Bankers Association's index of mortgage applications dropped 6% last week, while the average rate on a 30-year loan climbed to 7.53%. The housing market has cooled rapidly due to the Federal Reserve's tightening campaign, with demand for refinancing also falling. Higher mortgage rates are limiting inventory, as sellers who locked in low rates before the pandemic are reluctant to sell. The total number of homes for sale has tumbled by 9.2% compared to last year, leaving few options for buyers.