Mortgage applications rose last week for the first increase in eight weeks, led by an increase in purchase applications.
According to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending Nov. 11, the Market Composite Index — a measure of mortgage loan application volume — increased 2.7% on a seasonally adjusted basis from a week earlier. The results include an adjustment for the observance of Veterans Day.
On an unadjusted basis, the Index decreased 10% compared with the previous week.
The overall increase in applications was the first since the week ending Sept. 16.
The seasonally adjusted Purchase Index increased 4% from a week earlier, but the unadjusted Purchase Index was down 10% compared with the previous week and was 46% lower than the same week one year ago.
The Refinance Index, meanwhile, decreased 2% from the previous week and was 88% lower than the same week one year ago.
“Mortgage rates decreased last week as signs of slower inflation pushed Treasury yields lower,” said Joel Kan, MBA’s vice president and deputy chief economist. “The 30-year fixed rate saw the largest single-week decline since July 2022, dropping to 6.9%. Application activity, adjusted to account for the Veterans Day holiday, increased in response to the drop in rates.”
Kan noted that purchase applications increased for all loan types, and that the average purchase loan dipped to its smallest amount since January 2021.
Refinance activity remained depressed, said. “There is very little refinance incentive with rates so much higher than last year.”
The refinance share of mortgage activity decreased to 27.6% of total applications from 28.1% the previous week. The adjustable-rate mortgage (ARM) share of activity decreased to 10.6% of total applications.
The FHA share of total applications increased to 13.5%, up from 13.3% a week earlier. The VA share of total applications increased to 10.6% from 10.3% the previous week. The USDA share of total applications increased to 0.6% from 0.5% the week prior.
Other highlights from the report:
- The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($647,200 or less) decreased to 6.90% from 7.14%, with points decreasing to 0.56 from 0.77 (including the origination fee) for 80% loan-to-value ratio (LTV) loans. The effective rate decreased from last week.
- The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $647,200) increased to 6.51% from 6.50%, with points decreasing to 0.64 from 0.78 (including the origination fee) for 80% LTV loans. The effective rate decreased from last week.
- The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA increased to 6.93% from 6.86%, with points decreasing to 0.99 from 1.37 (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 6.27% from 6.40%, with points decreasing to 0.73 from 1.13 (including the origination fee) for 80% LTV loans. The effective rate decreased from last week.
- The average contract interest rate for 5/1 ARMs decreased to 5.73% from 5.87%, with points decreasing to 0.65 from 0.92 (including the origination fee) for 80% LTV loans. The effective rate decreased from last week.
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.
