Mortgage applications marked their second week in a row of increases, up 6.5% this week from last week’s 7.4% increase, according to the latest Weekly Mortgage Applications Survey from the Mortgage Bankers Association’s (MBA) for the week ending March 10, 2023.
This week’s numbers:
- The Market Composite Index, a measure of mortgage loan application volume, increased 6.5% on a seasonally adjusted basis from one week earlier.
- On an unadjusted basis, the Index increased 7% compared with the previous week.
- The Refinance Index increased 5% from the previous week and was 74% lower than the same week one year ago.
- The seasonally adjusted Purchase Index increased 7% from one week earlier.
- The unadjusted Purchase Index increased 8% compared with the previous week and was 38% lower than the same week one year ago.
- The refinance share of mortgage activity decreased to 28.2% of total applications from 28.9% the previous week.
- The adjustable-rate mortgage (ARM) share of activity decreased to 8.5% of total applications.
- The FHA share of total applications increased to 12.9% from 12.8% the week prior.
- The VA share of total applications decreased to 11.9% from 12.0% the week prior.
- The USDA share of total applications remained unchanged at 0.5% from the week prior.
- The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($726,200 or less) decreased to 6.71% from 6.79%, with points decreasing to 0.79 from 0.80 (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 6.39% from 6.49%, with points increasing to 0.61 from 0.59 (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 increased to 6.58% from 6.56%, with points decreasing to 1.20 from 1.21 (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 decreased to 6.14% from 6.25%, with points decreasing to 0.77 from 1.01 (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 5.69% from 5.75%, with points decreasing to 0.87 from 0.95 (including the origination fee) for 80% LTV loans. The effective rate decreased from last week.
MBA’s take:
“Treasury yields declined late last week, as market concerns over bank closures and the potential for broader ripple effects triggered a flight to safety in Treasury bonds. This decline pushed mortgage rates for all loan types lower, with the 30-year fixed rate decreasing to 6.71%,” said Joel Kan, MBA’s vice president and deputy chief economist. “Home-purchase applications increased for the second straight week but remained almost 40% below last year’s pace. While lower rates should buoy housing demand, the financial market volatility may cause buyers to pause their decisions.”
Added Kan, “Refinance activity remained more than 70% behind last year’s level, as rates are still more than two percentage points higher than a year ago. The dip in rates did bring some borrowers back as evidenced by the 5% increase in refinance applications last week.”
