Despite an increase in mortgage rates this past week, mortgage applications saw a second week of increases, up 3.3% from last week’s very slight uptick of 0.1%, according to the latest Weekly Mortgage Applications Survey from the Mortgage Bankers Association’s (MBA) for the week ending April 12, 2024. Analysis points to activity increasing over concern rates may climb further.
This week’s numbers:
- The Market Composite Index, a measure of mortgage loan application volume, increased 3.3% on a seasonally adjusted basis from one week earlier.
- On an unadjusted basis, the Index increased 4% compared with the previous week.
- The Refinance Index increased 0.5% from the previous week and was 11% higher than the same week one year ago.
- The seasonally adjusted Purchase Index increased 5% from one week earlier.
- The unadjusted Purchase Index increased 6% compared with the previous week and was 10% lower than the same week one year ago.
- The refinance share of mortgage activity decreased to 32.1% of total applications from 33.3% the previous week.
- The adjustable-rate mortgage (ARM) share of activity increased to 7.3% of total applications.
- The FHA share of total applications increased to 12.3% from 12.1% the week prior.
- The VA share of total applications decreased to 12.4% from 14.0% the week prior.
- The USDA share of total applications remained unchanged from 0.4% the week prior.
- The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($766,550 or less) increased to 7.13% from 7.01%, with points increasing to 0.65 from 0.59 (including the origination fee) for 80% loan-to-value ratio (LTV) loans. The effective rate increased from last week.
- The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $766,550) increased to 7.40% from 7.13%, with points decreasing to 0.46 from 0.56 (including the origination fee) for 80% LTV loans. The effective rate increased from last week.
- The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA increased to 6.90% from 6.80%, with points increasing to 0.99 from 0.93 (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 6.64% from 6.46%, with points increasing to 0.64 from 0.60 (including the origination fee) for 80% LTV loans. The effective rate increased from last week.
- The average contract interest rate for 5/1 ARMs increased to 6.52% from 6.41%, with points decreasing to 0.60 from 0.67 (including the origination fee) for 80% LTV loans. The effective rate increased from last week.
MBA’s take:
“Rates increased for the second consecutive week, driven by incoming data indicating that the economy remains strong and inflation is proving tougher to bring down. Mortgage rates increased across the board, with the 30-year fixed rate at 7.13% – reaching its highest level since December 2023,” said Joel Kan, MBA’s vice president and deputy chief economist. “Despite these higher rates, application activity picked up, possibly as some borrowers decided to act in case rates continue to rise. Purchase applications drove most of the increase, but remain at low levels of around 10% behind last year’s pace. Refinance applications increased very slightly, driven by a 3% gain in conventional applications.”
