October saw homebuyers’ ability to afford a home tumble yet again according to separate data reports yesterday.

According to real estate data company Black Knight, numbers of purchase loan rate-locks fell 37 percent year-over-year nationwide in October. As a measure of how far down home-price gains and interest-rate jumps have driven affordability and buyer interest, October’s purchase rate-lock tally was 26 percent below where it was in October 2019. The dollar volume of purchase rate locks was down 13 percent month-over-month and 39 percent year-over-year.

“Affordability remains the overarching concern in the mortgage origination market right now,” Scott Happ, president of Black Knight division Optimal Blue, said in a statement. “Despite home prices continuing to pull back in a growing number of markets across the country, the current rate environment means affordability remains a thorny challenge. It’s therefore not very surprising to see a resurgence of somewhat lower-rate loan products like [adjustable-rate mortgages]. Affordability, rates and home values all factor into falling purchase prices and loan sizes and all are generating headwinds over and above the normal seasonal downturn.”

Meanwhile, a report released by the Mortgage Bankers Association Monday showed the availability of mortgage credit fell slightly in October to just 2 percent above availability levels in March 2012, driven by a 2.5 percent decline in the availability of jumbo loans. The fall, the MBA said, is a sign that lenders are tightening credit standards.

“Mortgage credit availability declined for the eighth straight month in October to its lowest level since March 2013. Much higher mortgage rates and the worsening outlook for the housing market and economy are behind the continued tightening in credit availability,” MBA Vice President and Deputy Chief Economist Joel Kan said in a statement. “Lenders continue to reduce their capacity and are eliminating some loan offerings, including certain types of refinance loan products and others that require less than full borrower documentation.”

Black Knight’s report also noted an all-time low number of homeowners with a rate incentive to refinance. Across America, only 130,000 people have an interest rate on their mortgage high enough that refinancing now would benefit them. And “the vast majority,” Happ said, were at least 14 years into 30-year loans, leaving them with little reason to take out a new loan. The dollar volume of rate locks for cash-out refis was down 25.1 percent in October over the previous month and down 83.6 percent year-over-year, despite high amounts of tappable equity held by many homeowners. Rate/term refinance activity fell 15.7 percent month-over-month and 92.6 percent year-over-year.

“With interest rates now at their highest level in 20 years, the refi market is rapidly approaching a bottom,” Happ said.