The Mortgage Bankers Association (MBA) recently reported that mortgage applications are down 1.9% week over week, according to their Weekly Mortgage Applications Survey.
The breakdown:
– Market Composite Index (measures mortgage loan application volume) down 1.9% on a seasonally adjusted basis from the previous week
– Unadjusted, the index decreased 3% compared with the previous week
– Refinance Index decreased 3% from the previous week—4% lower YoY
– Seasonally adjusted Purchase Index decreased 0.2% from the previous week
– Unadjusted, the Purchase Index decreased 3% compared with the previous week—18% lower YoY
The takeaway:
Following a burst of refi increases over the past several months, the trend has started to taper, with the share of refi applications flat at 66.8% since the previous week. FHA applications are down to 10.9% and the VA share increased to 10.4%.
“Mortgage application volume fell last week to its lowest level since mid-July, as mortgage rates have stayed just above 3% for several weeks. Refinance volume has been moderating, while purchase volume continues to be lower than expected given the lack of homes on the market,” said Mike Fratantoni, MBA’s senior vice president and chief economist, in a statement. “Economic data has sent mixed signals, with slower job growth but a further drop in the unemployment rate in August. We expect that further improvements will lead to a tapering of Fed MBS purchases by the end of the year, which should put some upward pressure on mortgage rates.”
