After rising for two straight weeks, mortgage applications fell last week to their lowest level in a month, the Mortgage Bankers Association (MBA) said Thursday.
According to the MBA’s Weekly Mortgage Applications Survey for the week ended June 30, the Market Composite Index — a measure of mortgage loan application volume — decreased 4.4% on a seasonally adjusted basis from the previous week.
Last week’s results included an adjustment for the Juneteenth holiday. Unadjusted, the index increased 6% compared to the previous week.
The Refinance Index decreased 4% from the previous week and was 30% lower than the same week last year, the MBA said.
The seasonally adjusted Purchase Index decreased 5% from a week earlier. Unadjusted, the Purchase Index increased 6% from the previous week, but was 22% lower than the same week one year ago.
Affordability An Issue
“As mortgage-Treasury spreads remained wide, the 30-year fixed rate increased to 6.85%, the highest rate since the end of May,” said Joel Kan, MBA’s vice president and deputy chief economist. “Purchase applications decreased for the first time in a month, as homebuyers remained sensitive to rate changes.”
Kan said rates are still more than a percentage point higher than a year ago, making housing affordability a challenge in many parts of the country.
“However,” he said, “the average loan size for a purchase application declined to $423,500 — its lowest level since January 2023. This was likely driven by reduced purchase activity in some high-price markets and more activity in some of the lower-price tiers as buyers searched for more affordable options.”
The refinance share of mortgage activity inched up to 27.4% of total applications from 27.2% the previous week. The adjustable-rate mortgage (ARM) share of activity increased to 6.2% of total applications.
The FHA share of total applications ticked up to 13% from 12.9% a week earlier. The VA share of total applications decreased to 11.7% from 12.2% a week earlier. The USDA share of total applications remained unchanged at 0.4%.
Mortgage Rates
Note: The points listed include the origination fee and are for 80% loan-to-value (LTV) ratio loans.
- The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($726,200 or less) increased to 6.85% from 6.75%, with points increasing to 0.65 from 0.64. The effective rate increased from last week.
- The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $726,200) increased to 6.95% from 6.91%, with points decreasing to 0.64 from 0.69. The effective rate increased from last week.
- The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA increased to 6.68% from 6.63%, with points decreasing to 0.98 from 1.08. The effective rate increased from last week.
- The average contract interest rate for 15-year fixed-rate mortgages increased to 6.3% from 6.23%, with points increasing to 0.91 from 0.69. The effective rate increased from last week.
- The average contract interest rate for 5/1 ARMs decreased to 6% from 6.28%, with points increasing to 1.23 from 1.02. The effective rate decreased from last week.
The MBA’s survey covers over 75% of all U.S. retail residential mortgage applications, and has been conducted weekly since 1990. Respondents include mortgage bankers, commercial banks, and thrifts. Base period and value for all indexes is March 16, 1990=100.
