(Bloomberg) — A gauge of US home-purchase applications tumbled last week to the lowest level since 1995 as the highest mortgage rates in three months hammered a housing market struggling to stabilize.Most Read from BloombergThe Mortgage Bankers Association’s index of mortgage applications to buy a home slumped more than 18% — the biggest drop since 2015 — to 147.1 in the week ended Feb. 17, data out Wednesday showed.The contract rate on a 30-year fixed mortgage jumped another 23 basis points to 6.62%, the highest since November. The rate on the five-year adjustable mortgage also increased.The report illustrates the impact of the Federal Reserve’s interest-rate hikes over the past year to combat rapid inflation, as well as expectations that central bankers will keep raising borrowing costs. Mortgage News Daily, which updates more frequently, put the 30-year rate at 6.87% on Tuesday.Other figures on Tuesday showed that sales of previously owned homes dropped in January for a 12th-straight month to the slowest pace since 2010.The MBA’s index of refinancing applications fell 2.2% last week to a three-week low. The gauge of overall mortgage applications dropped more than 13%, the biggest slide since the last week of September. The data can be volatile around holidays, and the figures preceded Presidents’ Day on Monday.The MBA survey, which has been conducted weekly since 1990, uses responses from mortgage bankers, commercial banks and thrifts. The data cover more than 75% of all retail residential mortgage applications in the US.(Adds graphic)Most Read from Bloomberg Businessweek©2023 Bloomberg L.P.
