Mortgage Applications Take a Tumble

After three straight weeks of increased activity, mortgage applications went into decline in the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending March 1.

 

The Market Composite Index was down by 2.5 percent on a seasonally adjusted basis from one week earlier, although the unadjusted index increased by 10 percent.

 

The seasonally adjusted Purchase Index decreased by three percent from one week earlier, while the unadjusted index rose by 11 percent—and the latter was also one percent higher than the same week one year ago. The unadjusted Refinance Index dipped by two percent from the previous week as the refinance share of mortgage activity decreased to 40.0 percent of total applications from 40.4 percent the previous week.

 

Among the federal programs, the FHA share of total applications increased to 10.3 percent from 10.2 percent the week prior while the VA share of total applications decreased to 10.4 percent from 10.7 percent and the USDA share of total applications remained unchanged from 0.6 percent.

 

"Slightly higher mortgages rates last week led to a decrease in application volume," said MBA Chief Economist Mike Fratantoni. "Furthermore, the average loan size for purchase applications increased to a record high, led by a rise in the average size of conventional loans. This suggests that move-up and higher-end buyers have so far become a greater share of the spring market. Overall, conventional purchase loans are up 2.1 percent relative to last year, indicating that homebuyers continue to be inspired by the stable rate environment and the modest increase in housing supply."

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