Seasonal adjustments lead to minor increase amid lull
Home loan applications saw little movement amid the seasonal lull of Thanksgiving week, according to the Mortgage Bankers Association’s weekly survey for the week ending November 24.
Mortgage loan application volume inched up 0.3% on a seasonally adjusted basis from the week before. This increase, however, contrasted with the seasonally unadjusted 33% drop due to the holiday slowdown.
MBA’s refinance index fell 9% from the previous week but showed a slight year-over-year improvement of 1%. Meanwhile, the seasonally adjusted purchase index defied the typical Thanksgiving slump, posting a 5% week-over-week increase.
“Mortgage rates decreased for the fourth time in five weeks, with the 30-year fixed rate dipping to 7.37%, the lowest level in 10 weeks,” said MBA deputy chief economist Joel Kan. “There was a slight increase in applications overall, driven by a 5% increase in purchase applications, but refinance applications decreased over the week.
“Rates have declined more than 50 basis points over the past six weeks, which has helped to spur a small increase in purchase applications, but activity last week was still around 20% lower than a year ago. The purchase market remains depressed because of the ongoing low supply of existing homes on the market. Similarly, refinance activity will likely be muted for some time, even with the recent decline in rates, as many borrowers locked in much lower rates in 2020 and 2021.”
The share of refinance activity in total applications fell to 30.6% from 32.4% the previous week. Meanwhile, adjustable-rate mortgages (ARMs) comprised a smaller portion of the total, dropping to 8.1%.
Government loan applications showed varied changes: FHA loans decreased to 13.5% from 14.8% the week prior, VA loans rose to 12.6% from 11.3%, and USDA loans saw a one-basis-point uptick to 0.5%.
Stay updated with the freshest mortgage news. Get exclusive interviews, breaking news, and industry events in your inbox, and always be the first to know by subscribing to our FREE daily newsletter.
