After
Its Market Composite Index, a measure of weekly application activity based on surveys of its members, declined a seasonally adjusted 1.7% for the period ending Oct. 21. The index decreased for the 10th time in 11 weeks, and the numbers also represented a 68.9% drop in year-over-year volume.
"The ongoing trend of rising mortgage rates continues to depress mortgage application activity, which remained at its slowest pace since 1997," said Joel Kan, MBA vice president and deputy chief economist, in a press release.
The 30-year conforming rate as measured by the survey crossed the 7% threshold and is now at its highest since 2001, the association said.
At the
"MBA's forecast expects both economic and housing market weakness in 2023 to drive a 3% decline in purchase originations, while refinance volume is anticipated to decline by 24%," Kan said.
On a weekly basis, the MBA's seasonally adjusted Purchase Index slid another 2.3% from the previous seven-day period, falling to its lowest point since 2015. Current purchase volumes are now 42% below their level from a year ago.
The Refinance Index flattened, but edged up by 0.1%. Volumes were still 86% under its pace from the same week in 2021. But the share of refinances accounted for 28.8% of all loan activity, up from 28.3% seven days earlier.
Meanwhile, adjustable-rate mortgage activity relative to overall volume inched down to 12.7%, one week after grabbing a share of 12.8%, which was its largest since 2008.
Government-backed activity accounted for a greater share of volume compared with the previous week, thanks to an increase in the number of Federal Housing Administration-guaranteed loans.
"Despite higher rates and lower overall application activity, there was a slight increase in FHA-purchase applications, as FHA rates remained lower than conventional loan rates," Kan said.
The share of loans coming via other federal programs remained unchanged from the prior survey, though, with Department of Veterans Affairs-guaranteed applications comprising 10.7%, while mortgages backed by the
The increase in FHA purchases, combined with declining conventional volume, helped bring down average loan sizes. The mean amount on new purchase applications slipped a fraction to $402,400 from $402,600 a week earlier, while the average refinance size fell 3.7% to $265,000 from $275,200. The overall average came in 1% lower, dropping to $362,900 from $366,600 week over week.
Interest rates among MBA lenders surged across all categories reported by the association. The 30-year contract average for fixed-rate mortgages with conforming balances of $647,200 or below climbed 22 basis points, coming in at 7.16% compared to 6.94% a week earlier. Points decreased to 0.88 from 0.95 for 80% loan-to-value ratio loans..
The average contract rate for 30-year jumbo mortgages rose to 6.53% from 6.31% week over week, with points increasing to 0.68 from 0.67.
The 30-year FHA-backed mortgage came in with an average contract interest rate of 6.79%, a 16-basis point jump from 6.63% seven days earlier. Points decreased to 1.59 from 1.6.
The average contract interest rate for 15-year fixed-rate mortgages experienced a 30-basis point jump, coming in at 6.39% compared to 6.09% the prior week. Points increased to 1.52 from 1.18 for 80% LTV loans.
Meanwhile, the 5/1 adjustable-rate mortgage average also came in 21 basis points higher, rising to 5.86% from 5.65% the previous week, with points decreasing to 0.88 from 0.9.
