After four straight weeks of increases, home purchase applications registered a slight decline this week, but economists note that overall activity remains much higher than this time last year.
According to the latest Weekly Applications Survey from the Mortgage Bankers Association (MBA), mortgage applications decreased 1.3% from last week’s 14.2% surge. The data was recorded for the week ending Sept. 27.
“Last week’s incoming data showed an economy that is still growing at a solid pace, even as inflation continues to decline. As a result, mortgage rates were up modestly, with the 30-year fixed mortgage rate increasing slightly to 6.14%,” said Mike Fratantoni, MBA’s SVP and chief economist. “With this move, refinance application volume declined on the week but remains almost three-times as high as last year’s pace.”
Refinance activity also saw a slight decrease to 54.9% of total applications from 55.7% the previous week, MBA reported, with the adjustable-rate mortgage (ARM) share of activity decreasing to 5.8% of total applications.
“The news for the week was that more homebuyers appear to be entering the market. Purchase application activity was up for the week and increased more than 9 percent compared to last year at this time. Inventories of both new and existing homes have been increasing over the course of 2024, meaning that potential buyers have properties to look at and now have somewhat lower mortgage rates leading to better affordability.”
Last week, Freddie Mac tracked the average 30-year fixed rate mortgage at 6.08%, the lowest level rates have reached since 2022.
“Although this week’s decline was slight, the 30-year fixed-rate mortgage trended down to its lowest level in two years,” noted Sam Khater, Freddie Mac’s chief economist, following last week’s mortgage rate data release. “Given the downward trajectory of rates, refinance activity continues to pick up, creating opportunities for many homeowners to trim their monthly mortgage payment.”
Khater also noted that many looking to purchase a home “are playing the waiting game” to see if rates decrease further as additional economic data is released over the next several weeks.
The next Primary Mortgage Market Survey tracking average 30-year fixed mortgage rates will be released Thursday, Oct. 3.
MBA breaks down mortgage application activity tracking shares of FHA, VA, USDA, conforming loans, jumbo loans and more. To see the full list, visit: https://www.mba.org/news-and-research/newsroom/news/2024/10/02/mortgage-applications-decrease-in-latest-mba-weekly-survey
