Refinances recovered activity share after declining to a decade low
Overall mortgage application volume increased during the week ending March 23 as the activity share of refinance applications recovered from sinking to its lowest level since September 2008, according to the Weekly Mortgage Applications Survey released by the Mortgage Bankers Association.
The Market Composite Index, a measure of mortgage loan application volume, rose 4.8% on a seasonally adjusted and climbed 5% on an unadjusted basis. The Refinance Index inched up 2% from the previous period. The Purchase Index increased 3% on a seasonally adjusted and gained 5% on an unadjusted basis. Compared to the same week in 2017, the unadjusted Purchase Index was higher by 8%.
Refinances accounted for 39.4% of total applications during the period, up from their previous 38.5% share, which was the lowest since September 2008. The activity share of adjustable-rate mortgages (ARM) was unchanged at 7%.
FHA applications made up 9.9% of overall activity, down from its previous 10.3% share. The VA share slipped to 10.3% from 10.7%, while the USDA share of total applications remained unchanged at 0.8%.
Changes in average contract interest rates for the different mortgage types were mixed during the period.
The 30-year fixed-rate mortgage with conforming loan balances had an average rate of 4.69, up from 4.68%, with points decreasing to 0.43 from 0.46 for 80% loan-to-value ratio loans. Rates for 30-year fixed-rate mortgages with jumbo loan balances averaged 4.6%, an increase from 4.55%, with points decreasing to 0.36 from 0.37.
The average for 30-year fixed-rate mortgages backed by the FHA increased to 4.75% from 4.69%, with points decreasing to 0.56 from 0.81. The 15-year fixed-rate mortgage recorded a 4.09% average, which is a decrease from 4.12%, with points decreasing to 0.46 from 0.51. The average rate for 5/1 ARMs increased to 3.92% from 3.83%, with points decreasing to 0.46 from 0.68.
