Total mortgage demand fell 7.2% thanks to a big drop in refis, according to the latest data from the Mortgage Bankers Association…(MBA)
- REFIS: The Refinance Index fell 15% from the previous week and was 41% lower than the same week one year ago.
- PURCHASES: The Purchase Index increased 5% from one week earlier but was down 8% from the same week one year ago.
NOTE: The refinance share of mortgage activity decreased to 59.4 percent of total applications from 63.1 percent the previous week
The big decline in demand was probably a result of the increase in mortgage rates for the third week in a row…
- 30-YR FIXED: The average contract interest rate increased 7 basis points to 3.31% which is also 39 basis points higher than the same week one year ago.
- 15-YR FIXED: The average contract interest increased 4 basis points to 2.63% which is also 10 basis points higher than the same week one year ago..
Joel Kan, MBA’s Associate Vice President of Economic and Industry Forecasting, said demand is still strong for purchases even with higher rates…
- “Despite higher mortgage rates, purchase applications had a strong week, mostly driven by a 6 percent increase in conventional loan applications. Conventional loans tend to be larger than government loans, and this was evident in the average loan amount, which increased to $414,700 – the highest since February 2021. As home-price appreciation continues at a double-digit pace, buyers of newer, pricier homes continue to dominate purchase activity, while the share of first-time buyer activity remains depressed.”