Read more: U.S. mortgage rates march to 20-year high amid market turmoil

“Homebuyer affordability took an enormous hit in September, with the 75-basis-point jump in mortgage rates leading to the typical homebuyer’s monthly payment rising $102 from August,” said Edward Seiler, associate vice president of housing economics at MBA. “With mortgage rates continuing to rise, the purchasing power of borrowers is shrinking. The median loan amount in September was $305,550 – much lower than the February peak of $340,000.” 

The national median mortgage payment was $1,941 in September, up from $1,839 in August and was 40.4% higher in the first nine months of the year. For borrowers applying for lower-payment home loans (the 25th percentile), the national mortgage payment rose to $1,271 in September from $1,210 the previous month.

“MBA expects supply and affordability constraints and economic uncertainty to continue to hamper the purchase market. Purchase origination volume is forecast to decrease 3.3% next year to $1.53 trillion,” Seiler said.

Additional key findings were: