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MBA: Mortgage Applications Increase in Latest Weekly Survey


by Calculated Risk on 8/10/2022 07:00:00 AM

From the MBA: Mortgage Applications Increase in Latest MBA Weekly Survey

Mortgage applications increased 0.2 percent from one
week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage
Applications Survey for the week ending August 5, 2022.

… The Refinance Index increased 4 percent from the previous
week and was 82 percent lower than the same week one year ago. The seasonally adjusted Purchase
Index decreased 1 percent from one week earlier. The unadjusted Purchase Index decreased 2 percent
compared with the previous week and was 19 percent lower than the same week one year ago.

“Mortgage rates remained volatile last week – after drops in the previous two weeks, mortgage rates
ended up rising four basis points. Mortgage applications were relatively flat, with a decline in purchase
activity offset by an increase in refinance applications,” said Joel Kan, MBA’s Associate Vice President of
Economic and Industry Forecasting. “The purchase market continues to experience a slowdown, despite
the strong job market. Activity has now fallen in five of the last six weeks, as buyers remain on the
sidelines due to still-challenging affordability conditions and doubts about the strength of the economy.”

Added Kan, “Refinance applications increased over three percent but remained more than 80 percent
lower than a year ago in this higher rate environment.”

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances
($647,200 or less) increased to 5.47 percent from 5.43 percent, with points increasing to 0.80 from 0.65
(including the origination fee) for 80 percent loan-to-value ratio (LTV) loans.
emphasis added

Click on graph for larger image.

The first graph shows the refinance index since 1990.

With higher mortgage rates, the refinance index has declined sharply over the last several months.
The refinance index is just above the lowest level since the year 2000.
The second graph shows the MBA mortgage purchase index

According to the MBA, purchase activity is down 19% year-over-year unadjusted.
The purchase index is now only 12% above the pandemic low.

Note: Red is a four-week average (blue is weekly).

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