Mortgage applications increased 1.4 percent from one week earlier, for the week ending January 7, 2022. According to the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey, the Market Composite Index, which measures the mortgage loan application volume, increased 1.4 percent on a seasonally adjusted basis from one week earlier. The previous week’s results included an adjustment for the holidays.
Key findings:
- Unadjusted, the index increased 46% compared with the previous week.
- The seasonally adjusted Purchase Index increased 2% from one week earlier.
- The unadjusted Purchase Index increased 51% compared with the previous week 17% lower YoY.
- The refinance share of mortgage activity decreased to 64.1 percent of total applications.
- The adjustable-rate mortgage (ARM) share of activity decreased to 3.1 percent of total applications.
- The FHA share of total applications increased to 9.9 percent from 9.2 percent the week prior.
- The VA share of total applications increased to 11.4 percent from 11.3 percent the week prior.
- The USDA share of total applications remained unchanged from 0.4 percent the week prior.
The takeaway:
“Mortgage rates increased significantly across all loan types last week as the Federal Reserve’s signaling of tighter policy ahead pushed U.S. Treasury yields higher. The 30-year fixed rate hit 3.52 percent, its highest level since March 2020. Rates at these levels are quickly closing the door on refinance opportunities for many borrowers. Although refinance activity changed little over the week, applications remained at their lowest level in over a month, and conventional refinance applications were at their lowest level since January 2020,” said Joel Kan, MBA’s Associate Vice President of Economic and Industry Forecasting. “The housing market started 2022 on a strong note. Both conventional and government purchase applications showed increases, with FHA purchase applications increasing almost 9 percent, and VA applications increasing more than 5 percent. MBA expects solid growth in purchase activity this year, as demographic drivers and the strong economy support housing demand. However, the strength in growth will be dependent on housing inventory growing more rapidly to meet demand.”
For additional information, visit MBA’s website: www.mba.org.
