Residential Real Estate News
Mortgage Applications Uptick in U.S. Amid High Rates
According to the Mortgage Bankers Association's latest Weekly Mortgage Applications Survey for the week ending September 15, 2023, U.S. mortgage applications increased 5.4 percent from one week earlier. Last week's results included an adjustment for the Labor Day holiday.
The Market Composite Index, a measure of mortgage loan application volume, increased 5.4 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index increased 16 percent compared with the previous week.
The Refinance Index increased 13 percent from the previous week and was 29 percent lower than the same week one year ago. The seasonally adjusted Purchase Index increased 2 percent from one week earlier. The unadjusted Purchase Index increased 12 percent compared with the previous week and was 26 percent lower than the same week one year ago.
"Mortgage applications increased last week, despite the 30-year fixed rate edging back up to 7.31 percent - its highest level in four weeks," said Joel Kan, MBA's Vice President and Deputy Chief Economist. "Purchase applications increased for conventional and FHA loans over the week but remained 26 percent lower than the same week a year ago, as homebuyers continue to face higher rates and limited for-sale inventory, which have made purchase conditions more challenging. Refinance applications also increased last week but are still almost 30 percent lower than the same week last year."
Added Kan, "The average loan size on a purchase application was $416,800, the highest level in six weeks. Home prices in many markets have been supported by low inventory and resilient housing demand for available homes."
The refinance share of mortgage activity increased to 31.6 percent of total applications from 29.1 percent the previous week. The adjustable-rate mortgage (ARM) share of activity decreased to 7.2 percent of total applications.
The FHA share of total applications remained unchanged from 14.2 percent the week prior. The VA share of total applications decreased to 11.0 percent from 11.3 percent the week prior. The USDA share of total applications remained unchanged from 0.4 percent the week prior.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($726,200 or less) increased to 7.31 percent from 7.27 percent, with points remaining unchanged from 0.72 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans. The effective rate increased from last week.
The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $726,200) increased to 7.32 percent from 7.25 percent, with points increasing to 0.80 from 0.72 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.
The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA increased to 7.08 percent from 7.04 percent, with points decreasing to 0.92 from 0.98 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.
The average contract interest rate for 15-year fixed-rate mortgages decreased to 6.62 percent from 6.72 percent, with points increasing to 1.08 from 1.01 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.
The average contract interest rate for 5/1 ARMs decreased to 6.42 percent from 6.59 percent, with points decreasing to 1.10 from 1.16 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.
