Mortgage applications nationwide have fallen for two weeks in a row while sales of previously owned homes have fallen for four straight months. JP Morgan Chase & Co., the country’s largest bank, said recently that mortgage originations fell 45 percent in the second quarter from a year ago. Mortgage rates are closely tied to yields on the 10-year U.S. Treasury which fell near their lowest level in more than a month as investors bought government bonds. Yields and prices move in opposite directions. During periods of uncertainty treasuries are viewed as a haven.
George Ratio, manager of economic research at Realtor.com, noted that declining demand and growing supply are reshaping the housing market. “We can expect the pace of sales to continue to slow as we move into the second half of the year and markets regain a much-needed sense of balance,” he said.