The cost of housing is so high that, for the first time ever, banks are losing money on every mortgage they fund.

According to the Mortgage Bankers Association, the housing market is so expensive that some banks lost money on every mortgage they supported last year. This is the first time this has ever happened.

In a recent report, the association said that independent mortgage banks and mortgage subsidiaries of chartered banks lost an average of $301 on each mortgage they funded in 2022. That is a 113% drop from last year when the average income from a mortgage was $2,339. It is also the first time banks have lost money on home loans since the MBA started keeping track of profits in 2008.

Marina Walsh, vice president of industry research at MBA, said in a statement that this is mostly due to the drop in housing activity. Prospective buyers are staying away from the market because mortgage rates are close to their highest point in 20 years, and there are not enough homes for sale to keep prices down.

In 2022, banks and other mortgage companies financed an average of $2.6 billion in loans each, which is about half of what they did in 2021 when they financed $5 billion.

While this is going on, the cost of getting a loan has gone up because the drop in workers is not fast enough to make up for the drop in business. In 2022, it cost banks and mortgage companies an average of $10,624 to fund a home loan. This is a 23% increase from 2021.

"Mortgage rates went up quickly over a short period of time, and that, along with the low number of homes for sale and problems with affordability, led to a drop in both purchase and refinance activity," Walsh said. "The great profits from the last two years have gone away because the volume is going down, revenues are going down, and costs per loan are going up."

Some experts said last year that the US housing market could have a big correction if the falling demand for homes led to a drop in home prices. One MBA board member has said that home prices could drop by 9% this year. Other experts have expected a less severe correction. For example, one economist from the National Association of Realtors said that prices had already reached their lowest point and that the housing market could start to grow again.