For the second week in a row, mortgage applications faltered slightly, falling 0.6% from the week prior, according to a report from the Mortgage Bankers Association.
Purchase applications also took a hit last week, falling 2% from the week prior, however, remained 26% higher than this same time last year. Joel Kan, MBA’s vice president of economic and industry forecasting, pointed to a rise in mortgage rates last week for why conventional and government purchase activity took a step back.
The 30-year fixed rate climbed two basis points to 3.02, the highest since late September. Refinances, on the other hand, gained 0.2% and nearly recouped all of its losses from the week’s prior 0.3% dip. While last week’s index remained relatively stable, refinances hovered 74% higher than the same week a year ago.
“Despite the uptick in rates, refinance activity held steady, with FHA refinance applications posting a 17.6 percent increase, helping to offset declines in the other loan types,” said Kan.
Given the ongoing housing market recovery, as both purchase and refinance applications boasted robust numbers compared to a year ago, Kan estimates homebuyer demand will remain strong through the Fall.
That sentiment echoes recent data from the National Association of Home Builders that stated builder confidence posted it’s highest score in the survey’s 35-year history.
Here is a more detailed breakdown of this week’s mortgage application data:
- The FHA’s share of mortgage apps increased to 11.8% from 10.7%.
- The VA share of applications fell to 12.6% from 13.4%.
- The USDA share of total applications fell to 0.5% from 0.6%.
- The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($510,400 or less) increased to 3.02% from 3%.
- The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $510,400) increased to 3.33% from 3.3%.
- The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA remained unchanged at 3.12% from the week prior.
- The average contract interest rate for 15-year fixed-rate mortgages increased to 2.61 from 2.59%.
- The average contract interest rate for 5/1 ARMs increased to 2.86% from 2.63%.
The post As mortgage rates climb, applications fall six basis points appeared first on HousingWire.