Mortgage Bankers Association releases latest data
Mortgage applications decreased last week from one week earlier, according to recent data from the Mortgage Bankers Association (MBA).
MBA data revealed that mortgage loan applications decreased by 2.4% on a seasonally adjusted basis, and 3% on an unadjusted basis, for the week ending August 27, 2021, compared to one week earlier.
MBA’s refinance index also saw a 4% decrease from the previous week but was 2% higher than the same week one year ago.
Read more: What caused mortgage applications to drop this week?
Joel Kan, associate vice president of economic and industry forecasting at MBA, noted that applications fell despite little change in mortgage rates.
“There was little change in mortgage rates last week, with the 30-year fixed remaining at 3.03%,” said Kan. “Despite low rates, refinance applications declined, with some borrowers still waiting for rates to drop even lower. Recent uncertainty around the economy and pandemic have kept rates low over the past month, which is why the refinance index has oscillated around these levels.”
Broken down, the refinance share of mortgage activity decreased to 66.8% of total applications from 67.3% the previous week, while the adjustable-rate mortgage (ARM) share of activity increased to 3.2% of total applications.
Meanwhile, the FHA share of total applications increased to 11.2% from 11.0%, while the VA share of total applications decreased to 9.7% from 10.0%.
Additionally, the USDA share of total applications increased to 0.5% from 0.4% the week prior.
“Even with a slight increase, purchase activity hit its highest level since early July, as applications for conventional and government loans increased,” said Kan. “Home purchase activity continues to be dominated by higher price tiers of the market, with the purchase average loan size now at $396,500, the highest average in five weeks. According to FHFA, June’s year-over-year increase in home prices was 18.8%, while the second quarter saw a 17.4% increase overall. Both measures set new records, as housing demand continued to outpace the inventory of homes for sale.”
