MBA Weekly Applications Survey Dec. 22, 2021: Activity Slows for 2nd Straight Week
Mortgage applications fell for the second consecutive week—although steady interest rates sparked a slight uptick in refinancing activity, the Mortgage Bankers Association reported Wednesday in its Weekly Mortgage Applications Survey for the week ending Dec. 17.
The Market Composite Index decreased by 0.6 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased by 1 percent from the previous week.
The unadjusted Refinance Index, however, increased by 2 percent from the previous week, although it was 42 percent lower than the same week one year ago. The refinance share of mortgage activity increased to 65.2 percent of total applications from 63.3 percent the previous week.
The seasonally adjusted Purchase Index decreased by 3 percent from one week earlier. The unadjusted Purchase Index decreased by 6 percent from the previous week and was 9 percent lower than the same week one year ago.
The FHA share of total applications remained unchanged at 9.6 percent. The VA share of total applications increased to 11.5 percent from 10.6 percent the week prior. The USDA share of total applications decreased to 0.4 percent from 0.5 percent the week prior.
“Mortgage applications fell last week, driven by a 3 percent decline in purchase applications,” said Joel Kan, MBA Associate Vice President of Economic and Industry Forecasting. “Both conventional and government purchase applications were down, while the average purchase loan increased for the second straight week to $416,200 – the second highest amount ever. The elevated loan size is an indication that activity is more on the higher end of the market. Home-price appreciation growth remains faster than historical averages and inventory, particularly for starter homes, continues to trail strong demand.”
Kan noted the 30-year fixed rate decreased to 3.27 percent – its lowest level in four weeks – and helped spur an increase in refinances across all loan types. “FHA and VA refinances jumped 4 percent and 12 percent, respectively,” he said.
MBA reported the average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($548,250 or less) decreased to 3.27 percent from 3.30 percent, with points increasing to 0.41 from 0.39 (including origination fee) for 80 percent loan-to-value ratio loans. The effective rate decreased from last week.
The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $548,250) decreased to 3.31 percent from 3.32 percent, with points decreasing to 0.27 from 0.30 (including origination fee) for 80 percent LTV loans. The effective rate decreased from last week.
The average contract interest rate for 30-year fixed-rate mortgages backed by FHA decreased to 3.34 percent from 3.37 percent, with points increasing to 0.36 from 0.34 (including 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 2.59 percent from 2.58 percent, with points decreasing to 0.32 from 0.34 (including origination fee) for 80 percent LTV loans. The effective rate increased from last week.
The average contract interest rate for 5/1 adjustable-rate mortgages increased to 2.79 percent from 2.75 percent, with points remaining unchanged at 0.28 (including origination fee) for 80 percent LTV loans. The effective rate increased from last week.
The ARM share of activity remained unchanged at 3.4 percent of total applications.
The survey covers more than 75 percent of all U.S. retail and consumer direct residential mortgage applications and has been conducted weekly since 1990. Respondents include mortgage bankers, commercial banks and thrifts.
Please note: MBA offices will be closed Friday, December 24 and will reopen on Monday, January 3, 2022. Due to the holiday, the results for weeks ending December 24 and December 31 will be released on January 5, 2022.
