MBA Weekly Survey Dec. 13: Mortgage Applications Increase
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Mortgage applications increased 7.4% from one week earlier, according to data from the Mortgage Bankers Association’s Weekly Mortgage Applications Survey for the week ending Dec. 8, 2023.
The Market Composite Index, a measure of mortgage loan application volume, increased 7.4% on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index increased 6% compared with the previous week. The Refinance Index increased 19% from the previous week and was 27% higher than the same week one year ago. The seasonally adjusted Purchase Index increased 4% from one week earlier. The unadjusted Purchase Index decreased 1% compared with the previous week and was 18% lower than the same week one year ago.
“Mortgage rates dropped last week, as incoming data point to a slowing economy and support a pivot by the Federal Reserve to begin cutting rates next year. The average 30-year fixed mortgage rate declined to 7.07%, the lowest level since July,” said Mike Fratantoni, MBA’s SVP and Chief Economist. “Borrowers who had seen rates near 8% earlier this fall are now seeing some lenders quote rates below 7%. Refinance volume picked up in response to this drop in rates, with a particularly notable increase for FHA and VA refinance applications. Purchase volume was running about 18% below last year’s pace, as prospective homebuyers are still challenged by a lack of inventory, even if rates have
decreased.”
The refinance share of mortgage activity increased to 39.2% of total applications from 34.7% the previous week. The adjustable-rate mortgage (ARM) share of activity decreased to 6.3% of total applications.
The FHA share of total applications increased to 16.1% from 15.0% the week prior. The VA share of total applications increased to 14.2% from 12.8% the week prior. The USDA share of total applications decreased to 0.4% from 0.5% the week prior.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($726,200 or less) decreased to 7.07% from 7.17%, with points decreasing to 0.59 from 0.60 (including the origination fee) for 80% loan-to-value ratio (LTV) 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 $726,200) decreased to 7.22% from 7.35%, with points decreasing to 0.37 from 0.44 (including the origination fee) for 80% LTV loans. The effective rate decreased from last week.
The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA decreased to 6.84% from 6.98%, with points decreasing to 0.72 from 0.84 (including the origination fee) for 80% LTV loans. The effective rate decreased from last week.
The average contract interest rate for 15-year fixed-rate mortgages decreased to 6.67% from 6.80%, with points decreasing to 0.58 from 0.77 (including the origination fee) for 80% LTV loans. The effective rate decreased from last week.
The average contract interest rate for 5/1 ARMs decreased to 6.47% from 6.58%, with points increasing to 0.76 from 0.69 (including the origination fee) for 80% LTV loans. The effective rate decreased from last week.
Please Note:
MBA Offices will be closed Monday, Dec. 25, 2023 and will reopen on Tuesday, Jan. 2, 2024. Due to the holiday, the results for weeks ending Dec. 22, 2023 and Dec. 29, 2023 will both be released on Jan. 3, 2024.
If you would like to purchase a subscription of MBA’s Weekly Applications Survey, please visit www.mba.org/WeeklyApps, contact mbaresearch@mba.org or click here.
The survey covers over 75% of all U.S. retail residential mortgage applications, and has been conducted weekly since 1990. Respondents include mortgage bankers, commercial banks and thrifts. Base period and value for all indexes is March 16, 1990=100.
