Florida Mortgage Applications Decline; Experts Say Housing Market Slump Worsening

Florida mortgage applications fell for the first time in four weeks even as interest rates dropped to a six-month low, providing further evidence that the housing market slump, which is beginning to fully manifest itself after rampant speculation, may be deepening.

The Mortgage Bankers Association said that its seasonally adjusted index of mortgage application activity for the week ending September 22 decreased 4.9 percent to 566.6 from the previous week’s 595.8, which was its highest level since April.

Borrowing costs on 30-year fixed-rate Florida mortgages, excluding fees and points, averaged 6.18 percent, down a surprising 0.18 percent from the week before and hitting their lowest levels since February.

By contrast, 30-year fixed-rate Florida home mortgage loans (the industry’s most common and conventional loan) were above year-ago levels of 5.85 percent, but sharply below a four-year high of 6.86 percent touched in June. The seasonally-adjusted purchase mortgage index fell 5.5 percent to 375.9. The index was substantially below its year-ago level of 483.1.

The figures are considered a timely gauge of U.S. home sales. The group’s index of refinancing applications decreased 4.1 percent to 1,677.5.