Mortgage application payments in US decline 0.8% in September

ISTANBUL

Mortgage application payments decreased 0.8% to $2,041 in September, from $2,057 in August, the Mortgage Bankers Association (MBA) said Thursday.

The MBA said its Purchase Applications Payment Index (PAPI), which measures how new monthly mortgage payments vary across time relative to income, declined 0.8% to 157.9 in September from 159.2 in August.

A decrease in the PAPI, which is indicative of improving borrower affordability conditions, occurs when loan application amounts decline, mortgage rates decrease, or earnings increase, according to the MBA.

Americans' median earnings were up 4.2% compared to a year ago, while their payments decreased 5.3% annually, it noted.

"Homebuyer affordability conditions improved for the fifth consecutive month, as mortgage rates near the low 6 percent range improved purchasing power for prospective buyers," said Edward Seiler, MBA’s associate vice president of Housing Economics, and executive director of Research Institute for Housing America. "Overall affordability is now at its highest level since August 2022, but the recent jump in rates will likely cause conditions to plateau."

"MBA is forecasting for rates to be around 6.3 by the end of the year," he added.