Mortgage applications continued their second straight week of increases, rising slightly at 0.5% from the previous week’s 7.2% increase, according to the latest Weekly Mortgage Applications Survey from the Mortgage Bankers Association’s (MBA) for the week ending June 16, 2023.
This week’s numbers:
- The Market Composite Index, a measure of mortgage loan application volume, increased 0.5% on a seasonally adjusted basis from one week earlier.
- On an unadjusted basis, the Index decreased 1% compared with the previous week.
- The Refinance Index decreased 2% from the previous week and was 40% lower than the same week one year ago.
- The seasonally adjusted Purchase Index increased 2% from one week earlier.
- The unadjusted Purchase Index decreased 0.1% compared with the previous week and was 32% lower than the same week one year ago.
- The refinance share of mortgage activity decreased to 26.9% of total applications from 27.3% the previous week.
- The adjustable-rate mortgage (ARM) share of activity decreased to 6.3% of total applications.
- The FHA share of total applications increased to 13.3% from 13.0% the week prior.
- The VA share of total applications decreased to 11.9% from 12.6% the week prior.
- The USDA share of total applications decreased to 0.4% from 0.5% the week prior.
- The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($726,200 or less) decreased to 6.73% from 6.77%, with points decreasing to 0.64 from 0.65 (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) increased to 6.80% from 6.79%, with points decreasing to 0.49 from 0.50 (including the origination fee) for 80% LTV loans. The effective rate remained unchanged from last week.
- The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA increased to 6.74% from 6.70%, with points decreasing to 1.03 from 1.14 (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 increased to 6.26% from 6.25%, with points decreasing to 0.71 from 1.05 (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 6.09% from 5.90%, with points increasing to 1.4 from 1.17 (including the origination fee) for 80% LTV loans. The effective rate increased from last week.
MBA’s take:
“The 30-year fixed mortgage rate declined for the third consecutive week to 6.73%, while other mortgage rates saw mixed results. Purchase applications increased, driven by a 2% gain in conventional purchase applications and a 3% increase in FHA purchase activity,” said Joel Kan, MBA’s vice president and deputy chief economist. “First-time homebuyers account for a large share of FHA purchase loans, and this increase is a sign that while buyer interest is there, activity continues to be constrained by low levels of affordable inventory. Refinance applications continued their decline after the previous week’s increase, with the refinance share of applications just below 27%.”
Added Kan, “The rate for jumbo loans exceeded the conforming rate for the second straight week–the last time jumbo rates were higher was in December 2021. Tighter liquidity conditions have prompted jumbo lenders to pull back, increasing rates in the process.”
