After a slight reprieve last week, mortgage demand continued its descent with total demand falling 2.3%, according to the Mortgage Bankers Association…(MBA)
- THE PURCHASE INDEX fell 1.0% for the week and is now down 18% compared to the same time last year.
- THE REFINANCE INDEX wad down 5.0% and is now down 82% when compared to the same time last year.
NOTE: The refinance share of mortgage activity decreased to 31.2%of total applications and the adjustable-rate mortgage share of activity decreased to 7.0% of total applications.
Mortgage rates fell slightly for the week ending August 12th after a slight increase the prior week. The 30-year fixed fell two basis points to 5.45% but that is still 239 basis points higher than the same time one year ago.
- NOTE: The 15-year fixed increased 13 basis points to 4.87% and the 5/1 ARM fell 17 basis points to 4.43%.
Joel Kan, MBA economist, said mortgage activity has fallen to the lowest level in 22 years. “Mortgage application activity was lower last week, with overall applications declining over two percent to their lowest level since 2000. Home purchase applications continued to be held down by rapidly drying up demand, as high mortgage rates, challenging affordability, and a gloomier outlook of the economy kept buyers on the sidelines…” While rates remain high, Kan did note they are down 50 bips from the high at the start of the summer.
Exit Question: ARM activity is now down 35% from the high of 10.8% it reached on May 6th. What happened to the great ARM panic of 2022?