Home sales in America are witnessing a significant decline due to the high interest rate of mortgage loans (Getty)
Home sales in America fell for the ninth month in a row, in a clear reversal of an uptick interest rates applied to mortgage loans, which most Americans use to buy real estate.
On Friday, the National Association of Realtors said sales of previously owned homes were 5.9% lower in October than in September.
The association confirmed that this percentage represents The largest decline rate For US home sales since December of 2011, with the exception of the short period following the emergence and spread of the Covid-19 epidemic in the US, during 2020.
The association indicated that the data for the month of October brings home sales to an annual, seasonally adjusted level of regarding 4.43 million homes. down by 28.4% compared to the previous year.
The Fed has raised its funds rate six times this year, for a total hike of 3.75%, in an effort to tackle the country’s highest inflation in more than 40 years.
with existence Expectations are that the bank will continue to follow restrictive policies, at least until the first quarter of 2023. The interest rate applied to mortgage loans has increased by more than seven percent, making it more difficult to buy real estate, especially with the large increases in their prices that occurred during the past two years.
And following the inflation data for the month of October showed a decline in expectations, the interest rates applied to real estate loans decreased, to record a decline. under 7% level For the first time in five months.
Over the course of Wednesday and Thursday this week, the average fixed interest rate applicable to 30-year mortgage loans fell by 53 basis points to 6.61%, according to Mortgage Bankers Association data.
The decline in the cost of borrowing last week allowed the general measure of mortgage applications, which includes refinancing applications, to rise for the first time in two months. However, the index of refinancing activity fell to its lowest level in 22 years.
