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- The Market Composite Index decreased by 4%.
- The Refinance Index is down 3%.
- The seasonally adjusted Purchase Index declined by 6%.
The Mortgage Bankers Association's Weekly Mortgage Application Survey reported a 4% decline in mortgage applications from the previous week, for the week ending July 16, 2021.
Additionally, the MBA's survey reported that the Refinance Index fell by 3% from the previous week and the seasonally adjusted Purchase Index decreased by 6% from the previous week. The unadjusted Purchase Index was 18% lower year-over-year, which comes as no surprise with new home purchase applications falling almost 24% as reported yesterday.
Despite the world seemingly making headway in the fight against the COVID-19 virus, the rapidly spreading variants are causing concern when it comes to the possible impacts on the global economic recovery.
“The 10-year Treasury yield dropped sharply last week, in part due to investors becoming more concerned about the spread of COVID variants and their impact on global economic growth. There were mixed changes in mortgage rates as a result, with the 30-year fixed rate increasing slightly to 3.11% after two weeks of declines. Other surveyed rates moved lower, with the 15-year fixed rate loan, used by around 20% of refinance borrowers, decreasing to 2.46% - the lowest level since January 2021,” said Joel Kan, MBA's associate vice president of Economic and Industry Forecasting. “On a seasonally adjusted basis compared to the July 4th holiday week, mortgage applications were lower across the board, with purchase applications back to near their lowest levels since May 2020. Limited inventory and higher prices are keeping some prospective homebuyers out of the market. Refinance activity fell over the week, but because rates have stayed relatively low, the pace of applications was close to its highest level since early May.”
Meanwhile, the refinance share of mortgage activity increased to 64.9% of total applications, the adjustable-rate mortgage share of activity decreased to 3.3% and the FHA share increased very slightly from 9.5% to 9.6% from the previous week, according to the survey.
The VA share of total applications increased from 10.3% to 10.5% and the USDA share of total applications was unchanged.