Mortgage applications
The MBA's Market Composite Index, a measure of weekly loan volume based on surveys of association members, increased 3% on a seasonally adjusted basis for the seven-day period ending March 17.
"Both purchase and refinance applications increased for the third week in a row as borrowers took the opportunity to act, even though overall application volume remains at relatively low levels," said Joel Kan, MBA's vice president and deputy chief economist, in a press release.
The numbers are 51.6% lower compared to the same week one year ago, MBA said.
The Refinance Index climbed up 4.9% but activity is currently running 68.4% lower than a year ago, with many borrowers already sitting on favorable mortgage rates far below current levels. The share of refinances last week relative to overall volume also increased to 28.6% from 28.2% in the previous survey.
Meanwhile, the seasonally adjusted Purchase Index rose 2.2%, but on a year-over-year basis, volumes have declined by 36.2%.
The percentage of homeowners opting to stay in their homes rather than give up low mortgage rates they hold has served to limit new housing supply, leading to sluggishness in the housing market, as well as complicating plans for aspiring buyers,
Recent sizes of loan applications reported in the MBA surveys, in fact, point to consistent growth in purchase amounts throughout much of the first quarter this year. The average purchase size recorded last week climbed another 1.6% to $437,700, a 2023 high, after settling at $430,800 seven days earlier.
The mean refinance size also surged 3.8% to $267,700 from $257,800 one week prior, similarly bringing the average across all applications to its highest mark this year. The overall average increased $7,000, or 1.8%, to $389,000 from $382,000 a week earlier.
While the Market Composite Index increased, government-sponsored loan applications, which typically are used for more affordable properties, came in flat, inching down by 0.1% compared to the previous survey. The share of federally guaranteed applications, likewise, decreased.
Federal Housing Administration-backed mortgages accounted for 12.3% of volume, down from 12.9% the previous week. Applications guaranteed by the Department of Veterans Affairs garnered an 11.7% share compared to 11.9% seven days earlier, while the portion of loans sponsored by the U.S. Department of Agriculture remained at 0.5% week over week.
Even as rates fell, the share of adjustable-rate mortgages compared to overall activity edged upward to 8.6% from 8.5% the previous week. ARM activity tends to increase when rates are elevated.
But concerns about the health of the banking sector and its impact on the U.S. economy following recent industry upheaval drove Treasury yields — and mortgage rates — downward across the board among MBA lenders, according to Kan. Rates typically correspond to the direction of Treasury bond yields.
"However, mortgage rates have not dropped as much as Treasury rates due to increased
The average contract rate of 30-year fixed mortgages with conforming balances of $726,200 or less dropped 23 basis points to 6.48% from 6.71% seven days earlier. Points decreased to 0.66 from 0.79 for 80% loan-to-value ratio loans.
The contract fixed rate of 30-year jumbo mortgages with balances above the conforming amount averaged 6.3%, down 6 basis points from 6.39%. Points also decreased to 0.55 from 0.61 the previous week.
The average fixed rate for 30-year contract FHA-backed mortgages fell of 26 basis points to 6.32% from 6.58% one week prior, with points dropping to 1.07 from 1.2 for 80% LTV loans.
The 15-year contract fixed rate mortgage declined to an average of 6.02% from 6.14% week over week. Points decreased to 0.6 from 0.77.
The average hybrid rate for contract 5/1 ARMs also took an 11 basis-point tumble to 5.58% from 5.69% in the previous survey. As they did for other categories, points for these adjustable-rate mortgages decreased to 0.75 from 0.87.
