Mortgage Applications On The Rise
Mortgage applications rose again despite rates moving slightly up last week.
The Mortgage Bankers Association’s weekly survey shows the adjusted Market Composite Index – a measure of mortgage loan application volume – jumped 3.7%, adding to the week prior’s 10.4% spike.
Adjusted purchase applications rose by 8%, while the unadjusted index increased by 3% and was 18% lower YOY.
Demand may have been tempered by rates ticking up slightly from 6.75% to 6.78%. Still, even as buyers remain sensitive to rate movement they do appear to be leaping to lock in rates under 7%.
“Mortgage rates increased slightly last week, but there continues to be an upward trend in purchase activity. Conventional and FHA purchase applications drove most of the increase last week as some buyers moved to act early this season,” said Joel Kan, MBA’s Vice President and Deputy Chief Economist.
“Refinance applications declined over the week and remained at low levels. There is still little incentive for homeowners to refinance with rates at these levels.”
Refis fell by 7% and accounted for 32.7% of total applications. In the past decade, they averaged 58% of all activity.
If the Central Bank slashes rates this year, Americans who bought homes last year come out of the woodwork to refinance. In 2023, three million mortgages were originated at rates greater than 6%. Their monthly payments averaged averaging $2,201.
“A reduction in interest rates could not only help in stimulating the mortgage origination market, but could also provide an opportunity for millions of consumers who have recently taken on high-interest mortgages to refinance and see significant impacts to their monthly budgets,” Michele Raneri, VP of U.S. research and consulting at TransUnion, told Fortune.
ARMs, meanwhile, increased to 6.3% of all applications. The share of FHA, VA, and USDA loans all slipped.
Read More Articles:
To Buy Or Not To Buy? Homeowners Offer Insights
Direction Of Commercial Real Estate Market Unclear, But There Is A Glimmer Of Hope
Judge Finds UWM Engaged In Unfair Labor Practices
Listen To Our Podcast:
Sign up for our free newsletter.