Purchase Apps Up, Refis Down in MBA Weekly Survey

Mortgage applications rose for the third straight week, as a jump in purchase applications more than offset a decline in refinancings, the Mortgage Bankers Association reported this morning in its Weekly Mortgage Applications Survey for the week ending March 9.

The Market Composite Index increased by 0.9 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index increased by 2 percent compared to the previous week.

The Refinance Index decreased by 2 percent from the previous week. The refinance share of mortgage activity decreased to its lowest level since September 2008, 40.1 percent of total applications, from 41.8 percent the previous week.

The seasonally adjusted Purchase Index increased by 3 percent from one week earlier. The unadjusted Purchase Index increased by 5 percent compared to the previous week and was 3 percent higher than the same week one year ago.

The FHA share of total applications increased to 10.4 percent from 10.1 percent the week prior. The VA share of total applications increased to 10.3 percent from 9.9 percent the week prior. The USDA share of total applications remained unchanged at 0.9 percent from the week prior.

“Although the purchase market continues to be constrained by a lack of supply, applications for home purchase loans increased 3 percent last week to the highest level in over a month, as demographic and economic conditions remain favorable for housing demand,” said MBA Economist Joel Kan. “The refinance share of applications fell to its lowest level since September 2008. Refinance activity remains weak as rates have increased in essentially every week of 2018 thus far, reducing the benefit of a refinance for those borrowers currently in the market.”

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($453,100 or less) increased to its highest level since January 2014, 4.69 percent, from 4.65 percent, with points decreasing to 0.45 from 0.58 (including origination fee) for 80 percent loan-to-value ratio loans. The effective rate remained unchanged from last week.

The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $453,100) decreased to 4.55 percent from 4.56 percent, with points decreasing to 0.33 from 0.52 (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 increased to its highest level since July 2011, 4.73 percent, from 4.68 percent, with points decreasing to 0.76 from 0.79 (including 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 4.07 percent from 4.11 percent, with points decreasing to 0.46 from 0.64 (including origination fee) for 80 percent LTV loans. The effective rate decreased from last week.

The average contract interest rate for 5/1 adjustable-rate mortgages increased to its highest level since February 2011, 3.93 percent, from 3.81 percent, with points decreasing to 0.45 from 0.46 (including origination fee) for 80 percent LTV loans. The effective rate increased from last week.

The ARM share of activity decreased to 7.1 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.