Application volume increases despite continuous rise in rates
After three consecutive weeks of decline, US mortgage applications rebounded for the week ending March 3, the Mortgage Bankers Association reported Wednesday.
MBA’s latest survey showed that mortgage application volume bounced back 7.4% on a seasonally adjusted basis from a week earlier and was up 9% on an unadjusted basis. The increase comes despite the continued uptrend in interest rates.
“Mortgage rates continued to increase last week. The 30-year fixed rate rose to 6.79% – the highest level since November 2022 and 270 basis points higher than a year ago,” said Joel Kan, MBA’s vice president and deputy chief economist. “Even with higher rates, there was an uptick in applications last week, but this was in comparison to two weeks of declines to very low levels, including a holiday week.”
The refinance application activity saw a 9% increase, and purchase applications posted a 7% increase. Of total loan applications, the portion of refinance volume rose two basis points to 28.9% week over week. The adjustable-rate mortgage (ARM) share of activity grew to 8.6% of total applications.
“Comparing the application indices from a year ago, purchase applications were still down 42%, and refinance activity was down 76%. Many borrowers are waiting on the sidelines for rates to come back down,” Kan said
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