Mortgage applications plummeted 6.3% from one week earlier, according to data from the Mortgage Bankers Association.
The Market Composite Index is a measure of mortgage loan application volume. On an unadjusted basis, the Index increased 17% compared with the previous week.
The Refinance Index decreased 4% from a week prior and was 80% lower than the same week one year ago. The seasonally adjusted Purchase Index decreased 7% from one week earlier. The unadjusted Purchase Index increased 16% compared with the previous week and was 19% lower year over year.
“Mortgage applications declined for the third week in a row, reaching the lowest level since 2000. Similarly, with most mortgage rates more than two percentage points higher than a year ago, demand for refinances continues to plummet, with MBA’s refinance index also falling to a 22-year low,” Joel Kan, MBA’s associate vice president of Economic and Industry Forecasting, said. “Purchase activity declined for both conventional and government loans, as the weakening economic outlook, high inflation, and persistent affordability challenges are impacting buyer demand. The decline in recent purchase applications aligns with slower homebuilding activity due to reduced buyer traffic and ongoing building material shortages and higher costs.”
The refinance share of mortgage activity increased to 31.4% of total applications from 30.8% the week prior. The adjustable-rate mortgage (ARM) share of activity decreased to 9.5% of total applications.
The FHA share of total applications increased to 12.4% from 11.7% the week prior. The VA share of total applications dropped to 10.6% from 11.2% the week prior. The USDA share of total applications increased just slightly to 0.6% from 0.5% the week prior.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances–$647,200 or less–bumped up to 5.82% from 5.7%, with points increasing to 0.65 from 0.59 for 80 % loan-to-value ratio (LTV) loans. The effective rate increased from last week.
The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances, greater than $647,200, increased to 5.31% from 5.25%, with points remaining at a steady 0.38 for 80% LTV loans. The effective rate increased from last week.
The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA increased to 5.50 % from 5.4%, with points decreasing to 1.02 from 1.08, including the origination fee, for 80% LTV loans. The effective rate decreased from last week.
The average contract interest rate for 15-year fixed-rate mortgages decreased to 4.88% from 4.93%, with points increasing to 0.76 from 0.72 for 80% LTV loans. The effective rate decreased from last week.
