Mortgage Applications Decrease in Latest MBA Weekly Survey
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Mortgage applications decreased 10.6% from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending Feb. 16, 2024.
The Market Composite Index, a measure of mortgage loan application volume, decreased 10.6% on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased 8% compared with the previous week. The Refinance Index decreased 11% from the previous week and was 0.1% higher than the same week one year ago. The seasonally adjusted Purchase Index decreased 10% from one week earlier. The unadjusted Purchase Index decreased 6% compared with the previous week and was 13% lower than the same week one year ago.
“Mortgage rates moved back above 7% last week following news that inflation picked up in January, dimming hopes of a near term rate cut,” said Mike Fratantoni, MBA’s SVP and Chief Economist. “Mortgage applications dropped as a result with a larger decline in refinance applications. Potential homebuyers are quite sensitive to these rate changes, as affordability is strained with both higher rates and higher home values in this supply-constrained market.”
The refinance share of mortgage activity decreased to 32.6% of total applications from 34.0% the previous week. The adjustable-rate mortgage (ARM) share of activity increased to 7.4% of total applications.
The FHA share of total applications decreased to 13.2% from 13.5% the week prior. The VA share of total applications decreased to 12.1% from 13.3% the week prior. The USDA share of total applications increased to 0.5% from 0.4% the week prior.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($766,550 or less) increased to 7.06% from 6.87%, with points increasing to 0.66 from 0.65 (including the origination fee) for 80% loan-to-value ratio (LTV) 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 $766,550) increased to 7.16% from 7.00%, with points increasing to 0.45 from 0.39 (including the origination fee) for 80% LTV loans. The effective rate increased from last week.
The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA increased to 6.91% from 6.68%, with points increasing to 1.03 from 0.89 (including the origination fee) for 80% LTV loans. The effective rate increased from last week.
The average contract interest rate for 15-year fixed-rate mortgages increased to 6.61% from 6.53%, with points decreasing to 0.77 from 0.94 (including the origination fee) for 80% LTV loans. The effective rate increased from last week.
The average contract interest rate for 5/1 ARMs increased to 6.37% from 6.30%, with points increasing to 0.71 from 0.60 (including the origination fee) for 80% LTV loans. The effective rate increased from last week.
Note: Results for week ending 2/9/24 were revised due to a revised data submission and results are re-released this week.
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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.
