Mortgage applications saw a slight increase of 0.5% from last week’s bump of 2.6%, according to the latest Weekly Mortgage Applications Survey from the Mortgage Bankers Association (MBA) for the week ending May 10, 2024.
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 increased 0.3% compared with the previous week.
- The Refinance Index increased 5% from the previous week and was 7% higher than the same week one year ago.
- The seasonally adjusted Purchase Index decreased 2% from one week earlier.
- The unadjusted Purchase Index decreased 2% compared with the previous week and was 14% lower than the same week one year ago.
- The refinance share of mortgage activity increased to 32.0% of total applications from 30.6% the previous week.
- The adjustable-rate mortgage (ARM) share of activity decreased to 7.0% of total applications.
- The FHA share of total applications decreased to 12.4% from 12.9% the week prior.
- The VA share of total applications increased to 12.7% from 11.7% the week prior.
- The USDA share of total applications remained unchanged at 0.4% from the week prior.
- The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($766,550 or less) decreased to 7.08% from 7.18%, with points decreasing to 0.63 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 $766,550) decreased to 7.22% from 7.31%, with points increasing to 0.58 from 0.46 (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 decreased to 6.86% from 6.92%, with points increasing to 0.94 from 0.91 (including the origination fee) for 80% LTV loans. The effective rate decreased from last week.
- The average contract interest rate for 15-year fixed-rate mortgages increased to 6.61% from 6.60%, with points increasing to 0.65 from 0.59 (including the origination fee) for 80% LTV loans. The effective rate increased from last week.
- The average contract interest rate for 5/1 ARMs decreased to 6.56% from 6.60%, with points increasing to 0.66 from 0.65 (including the origination fee) for 80% LTV loans. The effective rate decreased from last week.
MBA’s take:
“Treasury yields continued to move lower last week and mortgage rates declined for the second week in a row, with the 30-year fixed rate down 10 basis points to 7.08%, the lowest level since early April,” said Joel Kan, MBA’s Vice President and Deputy Chief Economist. “The decline in rates led to a small boost to refinance applications, including another strong week for VA refinances. However, the overall level of refinance activity remains low. Purchase applications decreased, driven largely by a 9% drop in FHA purchase applications. Conventional home purchase applications were down around one%.
Added Kan, “While the downward move in rates benefits prospective homebuyers, mortgage rates are still much higher than they were a year ago, while for-sale inventory remains tight.”
