Find out what happened on the week of July 4 celebrations
Mortgage application activity saw minimal change last week, according to data from the Mortgage Bankers Association (MBA).
The Market Composite Index, a measure of overall mortgage loan application volume, dipped 0.2% week over week on a seasonally adjusted basis, MBA’s weekly applications survey for the week ending July 5 showed. This follows an adjustment for the July 4 holiday in the previous week’s report.
On an unadjusted basis, the index saw a steeper decline of 20% compared to the previous week.
Purchase activity picked up slightly, while refinance applications decreased for the fourth consecutive week. The seasonally adjusted purchase index increased by 1% from the previous week, although it remained 13% lower than the same period last year.
Refinance applications, on the other hand, continued their downward trend for the fourth consecutive week, with a 2% decrease compared to the prior week. However, refinance applications remained 28% higher year-over-year.
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“Purchase activity picked up slightly, driven primarily by increases in FHA and VA applications,” Joel Kan, vice president and deputy chief economist at MBA, said in the embargoed report emailed to MPA. “Refinance applications decreased for the fourth consecutive week, in line with higher rates. Although home equity gains have been significant in recent years, most borrowers do not have much of an incentive to refinance at current rates.”
Kan attributed the flat application activity to a consistently high average contract interest rate for 30-year fixed-rate mortgages.
“The recent uptick in mortgage rates has slowed demand. Mortgage applications were essentially flat last week, as mortgage rates remained around 7%,” he said.
MBA’s data also showed that refinance activity accounted for 34.9% of total applications, down from 35.7% the week before. The share of adjustable-rate mortgage (ARM) activity increased to 6.2% of total applications.
The FHA’s share of total applications decreased to 12.5% from 13.1% the previous week. The VA’s share rose to 13.7% from 12.9%, while the USDA’s share increased one basis point to 0.4%.
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