Mortgage Applications Dip in Mid-November

According to the Mortgage Bankers Association's Weekly Mortgage Applications Survey for the week ending November 9, 2018, U.S. mortgage applications decreased 3.2 percent from one week earlier.

The Market Composite Index, a measure of mortgage loan application volume, decreased 3.2 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased five percent compared with the previous week.

The Refinance Index decreased 4.3 percent from the previous week reaching its lowest level since December 2000. The seasonally adjusted Purchase Index decreased 2.3 percent from one week earlier reaching its lowest level since February 2017. The unadjusted Purchase Index decreased 5 percent compared with the previous week and was 3 percent lower than the same week one year ago.

"Recent volatility in the financial markets and increasing rates continue to adversely impact mortgage application activity, even as the general economic outlook remains positive," said Joel Kan, MBA's AVP of Economic and Industry Forecasting. "Both home purchase and mortgage refinance applications decreased over the week, driven largely by declines in conventional applications. Mortgage rates increased over the week for most loan types, with the 30-year fixed rate mortgage increasing to 5.17 percent - the highest level since 2010."

The refinance share of mortgage activity increased to 39.4 percent of total applications from 39.1 percent the previous week. The adjustable-rate mortgage (ARM) share of activity decreased to 7.7 percent of total applications.

The FHA share of total applications increased to 10.6 percent from 10.1 percent the week prior. The VA share of total applications remained unchanged at 10.1 percent from the week prior. The USDA share of total applications remained unchanged at 0.7 percent from the week prior.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($453,100 or less) increased to 5.17 percent from 5.15 percent, with points increasing to 0.55 from 0.51(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 $453,100) increased to 4.98 percent from 4.97 percent, with points increasing to 0.28 from 0.27 (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 decreased to 5.08 percent from 5.15 percent, with points decreasing to 0.55 from 0.64 (including the origination fee) for 80 percent LTV loans. The effective rate decreased from last week.

The average contract interest rate for 15-year fixed-rate mortgages increased to 4.57 percent from 4.55 percent, with points increasing to 0.56 from 0.51 (including the origination fee) for 80 percent LTV loans.

The effective rate increased from last week. The average contract interest rate for 5/1 ARMs increased to 4.45 percent from 4.36 percent, with points decreasing to 0.31 from 0.35 (including the origination fee) for 80 percent LTV loans. The effective rate increased from last week.