Economy · August 3, 2022

Mortgage applications rise in the latest weekly survey

from Active calculated risk 8/03/2022 07:00:00

Since MBA: Increase in Mortgage Applications in Latest Weekly MBA Survey

– Mortgage applications were up 1.2% from a week earlier, according to data from the Mortgage Bankers Association (MBA) Weekly Mortgage Application Survey for the week ending July 29, 2022.

… The refinancing ratio increased 2% from the previous week and was 82% lower than the same week a year ago. The seasonally adjusted purchasing index rose 1% from a week earlier. The unadjusted buying index rose 1% from the previous week and has been 16 percent less than the same week a year ago.

Mortgage rates fell last week following another announcement of tighter monetary policy by the Federal Reserve, with further rate hikes likely to come. As a result, Treasury yields fell as investors continue to expect a weaker macroeconomic environment in the coming months. The 30-year fixed rate saw the largest weekly decline since 2020, dropping 31 basis points to 5.43 percent, “said Joel Kan, associate vice president for business and industrial forecasts at MBA.” The drop in rates has led to increases in both refinancing and purchase requests, but activity is still depressed compared to a year ago. Lower mortgage rates, combined with signs of rising inventories in the market, could lead to a rebound in purchasing activity “.

The average contract interest rate for 30-year fixed-rate mortgages with compliant loan balances ($ 647,200 or less) fell to 5.43 percent from 5.74 percent, with points increasing to 0.65 from 0 , 61 (including origination fee) for 80 percent loan-to-value-ratio loans (LTV).
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Mortgage refinancing indexClick on the graphic to enlarge the image.

The first graph shows the refinancing index since 1990.

With higher mortgage rates, the refinancing ratio has fallen sharply in recent months.

The refinancing ratio is just above the lowest level since the year 2000.

The second chart shows the MBA Purchase Mortgage Index

Mortgage purchase index
According to the MBA, buying activity declined 16% year-over-year with no adjustments.
The buying index is now just 14% above the low of the pandemic.

Note: Red is a four week average (blue is weekly).