Weekly gain was driven by increase in one type of volume
The volume of US mortgage applications increased 1.1% as interest rates dipped slightly last week, the Mortgage Bankers Association reported Wednesday.
Overall mortgage application activity posted a 1.1% gain for the week ending July 14, including an adjustment for Independence Day. On an unadjusted basis, applications surged 27% from the previous week.
“Mortgage rates declined last week, as markets responded positively to incoming data showing that US inflation continues to cool. Most rates in our survey declined, with the 30-year fixed rate falling to 6.87%,” said Joel Kan, vice president and deputy chief economist for MBA.
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The uptick was driven by a 7% increase in refinance volume, data from MBA’s weekly survey showed. However, that activity accounted for only 28.4% of applications and was more than 30% behind last year’s pace, Kan noted. Meanwhile, purchase applications slipped 1% on a seasonally adjusted basis but were up 21% on an unadjusted basis.
“Despite last week’s lower rates, purchase applications decreased, as home purchase activity is still being held back by low housing supply and rates that are still much higher than a year ago,” Kan said.
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