MBA Weekly Survey Apr. 26, 2023: Spring Season Slowly Kicks into Gear

With the spring home-buying season well underway, mortgage activity picked up last week, the Mortgage Bankers Association reported Wednesday in its Weekly Mortgage Applications Survey for the week ending April 21. 

The Market Composite Index increased by 3.7 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index increased by 5 percent from the previous week. 

The unadjusted Refinance Index increased by 2 percent from the previous week but was 51 percent lower than the same week one year ago. The refinance share of mortgage activity decreased to 26.8 percent of total applications from 27.6 percent the previous week.

The seasonally adjusted Purchase Index increased by 5 percent from one week earlier. The unadjusted Purchase Index increased by 6 percent from the previous week but was 28 percent lower than the same week one year ago.

The FHA share of total applications decreased to 12.6 percent from 12.7 percent the week prior. The VA share of total applications decreased to 11.2 percent from 11.7 percent the week prior. The USDA share of total applications decreased to 0.4 percent from 0.5 percent the week prior.

“Both conventional and government home purchase applications increased last week. However, activity was still nearly 28 percent below last year’s pace, as high mortgage rates and low supply have slowed the market this year, even as home-price growth has decelerated in many markets across the country,” said Joel Kan, MBA Vice President and Deputy Chief Economist. “Refinance applications also increased last week but remained at half of last year’s levels. Although incoming data points to a slowdown in the U.S. economy, markets continue to expect that the Fed will raise short-term rates at its next meeting, which have pushed Treasury yields somewhat higher. As a result of the higher yields, mortgage rates increased for the second straight week to their highest level in over a month, with the 30-year fixed rate now at 6.55 percent.”

MBA reported the average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($726,200 or less) increased to 6.55 percent from 6.43 percent, with points remaining at 0.63 (including origination fee) for 80 percent loan-to-value ratio 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 6.40 percent from 6.28 percent, with points decreasing to 0.5 from 0.51 (including 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 FHA increased to 6.41 percent from 6.33 percent, with points increasing to 1.04 from 0.94 (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 increased to 6.03 percent from 5.89 percent, with points decreasing to 0.56 from 0.65 (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 decreased to 5.47 percent from 5.56 percent, with points increasing to 1.18 from 0.72 (including origination fee) for 80 percent LTV loans.  The effective rate increased from last week.

The ARM share of activity increased to 6.7 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.