US home loan applications drop to the lowest since 2015 as the coronavirus pandemic continues to weigh on the housing market

• The US home loan purchase index fell 12% in the week ending April 3 to its lowest point since 2015, according to a Wednesday survey from the Mortgage Bankers Association.
• Mortgage applications also declined nearly 18% last week on an adjusted basis, and refinancing applications fell 19% in the same period but are still up on the year.
• "Given the ongoing rate volatility, along with the persistent lack of liquidity in certain sectors of the MBS market, we expect to see continued weekly swings in refinance activity," said Joel Kan of the MBA in a statement.
• Read more on Business Insider.

Economic fallout due to the coronavirus pandemic is weighing on potential homebuyers in the US.

The US home loan purchase index fell 12% in the week ending April 3, according to a Wednesday survey from the Mortgage Bankers Association. The index is now at its lowest level since 2015, and down 33% on the year.

In addition, mortgage applications declined nearly 18% last week on an adjusted basis, and refinancing applications fell 19% in the same period but are still up on the year.

"Mortgage applications fell last week, as economic weakness and the surge in unemployment continues to weigh heavily on the housing market," said Joel Kan, MBA's associate vice president of economic and industry forecasting, in a press release.

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The housing market was initially boosted as the coronavirus pandemic led to a market rout that sent mortgage rates plummeting. But as the crisis has worn on, housing has taken a hit as consumers are told to stay home and practice-social distancing to curb the spread of the disease. In addition, potential homebuyers may be rethinking purchases as economic data shows severe damage amid the crisis and points to high unemployment and a US recession.

Existing homeowners are also seeking relief as the coronavirus outbreak continues. Requests for suspending or reducing mortgage payments skyrocketed more than 3,000% in March, according to a survey from the MBA.

"Given the ongoing rate volatility, along with the persistent lack of liquidity in certain sectors of the MBS market, we expect to see continued weekly swings in refinance activity," Kan said.

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