Mortgage applications increased 15.5 percent from one week earlier, according to data from the Mortgage Bankers Association's Weekly Mortgage Applications Survey for the week ending March 4, 2011. The Market Composite Index, a measure of mortgage loan application volume, increased 15.5 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index increased 16.1 percent compared with the previous week.
Last week's Freddie Mac Primary Mortgage Market Survey (PMMS) found that the 30-year fixed-rate mortgage (FRM) dipped below five percent to 4.87 percent, with an average 0.7 point for the week ending March 3, 2011, down from the previous week when it averaged 4.95 percent.
The previous week did not include a holiday adjustment for Presidents' Day. The Refinance Index increased 17.2 percent from the previous week and was the highest Refinance Index observed since the week ending Jan. 14, 2011.
The seasonally adjusted Purchase Index increased 12.5 percent from one week earlier and was the highest Purchase Index recorded this year. The unadjusted Purchase Index increased 14.3 percent compared with the previous week and was 14.3 percent lower than the same week one year ago.
"Taking into account typical seasonal patterns, purchase applications rose to their highest level of the year last week. On an unadjusted basis, purchase application activity is the highest since last May," said Michael Fratantoni, MBA's vice president of research and economics. "An improving job market is beginning to pave the way for an improving housing market. Additionally, mortgage interest rates remained below five percent for a second week, maintaining affordability for buyers and leading to an increase in refinance applications."
The four week moving average for the seasonally adjusted Market Index is up 2.7 percent. The four week moving average is up 1.2 percent for the seasonally adjusted Purchase Index, while this average is up 3.6 percent for the Refinance Index.
The refinance share of mortgage activity increased to 65.5 percent of total applications from 64.9 percent the previous week. The adjustable-rate mortgage (ARM) share of activity increased to six percent from 5.5 percent of total applications from the previous week.
The average contract interest rate for 30-year fixed-rate mortgages increased to 4.93 percent from 4.84 percent, with points decreasing to 0.87 from 1.29 (including the origination fee) for 80 percent loan-to-value (LTV) ratio loans. The effective rate also increased from last week.
The average contract interest rate for 15-year fixed-rate mortgages remained unchanged at 4.17 percent, with points increasing to 1.15 from 1.07 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.
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