Mortgage applications decreased 1.2% from one week earlier after they saw a slight 3.7% uptick, according to the latest Weekly Mortgage Applications Survey from the Mortgage Bankers Association’s (MBA) for the week ending April 28, 2023.
This week’s numbers:
- The Market Composite Index, a measure of mortgage loan application volume, decreased 1.2% on a seasonally adjusted basis from one week earlier.
- On an unadjusted basis, the Index decreased 0.4% compared with the previous week.
- The Refinance Index increased 1% from the previous week and was 51% lower than the same week one year ago.
- The seasonally adjusted Purchase Index decreased 2% from one week earlier.
- The unadjusted Purchase Index decreased 1% compared with the previous week and was 32% lower than the same week one year ago.
- The refinance share of mortgage activity increased to 27.2% of total applications from 26.8% the previous week.
- The adjustable-rate mortgage (ARM) share of activity increased to 7.3% of total applications.
- The FHA share of total applications decreased to 12.5% from 12.6% the week prior.
- The VA share of total applications increased to 11.3% from 11.2% the week prior.
- The USDA share of total applications increased to 0.5% from 0.4% the week prior.
- The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($726,200 or less) decreased to 6.50% from 6.55%, with points remaining at 0.63 (including the origination fee) for 80% loan-to-value ratio (LTV) loans. The effective rate decreased from last week.
- The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $726,200) decreased to 6.37% from 6.40%, with points increasing to 0.54 from 0.50 (including the origination fee) for 80% LTV loans. The effective rate decreased from last week.
- The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA increased to 6.43% from 6.41%, with points decreasing to 1.02 from 1.04 (including the origination fee) for 80% LTV loans. The effective rate increased from last week.
- The average contract interest rate for 15-year fixed-rate mortgages decreased to 6.01% from 6.03%, with points decreasing to 0.55 from 0.56 (including the origination fee) for 80% LTV loans. The effective rate decreased from last week.
- The average contract interest rate for 5/1 ARMs increased to 5.48% from 5.47%, with points decreasing to 1.14 from 1.18 (including the origination fee) for 80% LTV loans. The effective rate remained unchanged from last week.
MBA’s take:
“Mortgage applications decreased last week, despite rates declining slightly for the first time in three weeks. The 30-year fixed rate decreased five basis points to 6.5%, which is still 114 basis points higher than a year ago,” said Joel Kan, MBA’s vice president and deputy chief economist. “Elevated rates continue to both impact homebuyer affordability and weaken demand for refinancing. Home purchase activity has been very sensitive to rates and local market trends, including the very low supply of existing-home inventory. However, newly constructed homes account for a growing share of inventory, giving more options for prospective buyers.”
Added Kan, “The jumbo-conforming spread continues to narrow, an indication that there is reduced lender appetite for jumbo loans following the recent turmoil in the banking sector and heightened concerns about liquidity. The spread was 13 basis points last week, after being as wide as 64 basis points in November 2022.”
