The Mortgage Banker Association’s Weekly Mortgage Application Survey for May 7, 2021, showed mortgage applications increased 2.1% from the week prior. On an unadjusted basis, the Market Composite Index showed an increase of 2% in mortgage applications compared to the week prior.
The refinance share of mortgage activity increased to 61.3% of total applications from 61.0% a week earlier. The refinance index increased 3% from the previous week and was 12% lower than the same week a year ago. Meanwhile, the seasonally adjusted purchase index increased 1% from a week earlier. The unadjusted purchase index increased 1% from the previous week and was 13% higher than the same week a year ago.
"The first week of May was also strong for the purchase market. Applications were up 13 percent from a year ago, which was around the time the housing market awakened from the pandemic-induced stall in activity,” said Joel Kan, the MBA's associate vice president of economic and industry forecasting. “Most markets this spring continue to see robust demand, but activity continues to be constrained by insufficient inventory levels, as well as homebuilder challenges related to the ongoing shortages and price increases for building materials.”
The FHA share of total applications decreased to 9.9% from 10.1% the week prior. The VA share of total applications decreased to 11.7% from 11.9%. However, the USDA share of total applications increased to 0.5% from 0.4% the week prior.
The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA decreased to 3.07% from 3.13% the week prior for 80% LTV loans. The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances decreased to 3.27% from 3.31% the week prior for 80% LTV loans. Also, the average contract interest rate for 15-year fixed-rate mortgages decreased to 2.49% from 2.54% the previous week for 80% LTV loans.
Click here to read more from the MBA's WMAS.
