Mortgage lending declined to the lowest level in 14 years in the first quarter as homeowners pulled back sharply from refinancing and house hunters showed little appetite for new loans, the latest sign of how rising interest rates have dented the housing recovery.
Lenders originated $235 billion in mortgage loans during the January-March quarter, down 58% from the same period a year ago and down 23% from the fourth quarter of 2013, according to industry newsletter Inside Mortgage Finance.
The decline shows how the mortgage market is experiencing its largest shift in more than a decade as an era of generally falling interest rates that began in 2000 appears to have run its course.
Maybe people have figured out that homes are to live in, not to speculate. Anyway, it’s not like the middle has a lot of extra cash to chase after rising interest rates.
And don’t get me started on how the banks and feds are marketing foreclosures in smaller markets. Not every place is Miami or Phoenix.
Yes, the middle class is horribly squeezed, e.g. the “affluent middle class” who now find they make too much for Obamacare subsidies and the Gold family Ocare policy that comes closest to what they had runs about $22k per year. And the young 30 somethings just out of college or graduate school who have $75k-125k in student loans and a new car loan discover they don’t meet the loan requirements.
And us old geezers may have a paid off home [or not] but can’t get squat for it in a still-depression era like market [unless you live in DC, Denver, or San Fran].
In our area I know a family that runs an A/C business, live in a nice waterfront house and decided to not get Ocare because their premium was over $25k and they make too much for the subsidy.
It’s the small-business owners in the middle class I fear for the most. I may as well add their employees, as well.