Home loan application activity increased this past week, up slightly from the previous week and following the trend of steady average mortgage rates hovering around 6%, even dipping below for a few days this past week.
According to the latest Market Composite Index from the Mortgage Bankers Association (MBA)—its measure of mortgage loan activity volume and includes purchases and refinances—increased 0.4% on a seasonally adjusted basis from last week’s 2.8% increase, for the week ending Feb. 19. On an unadjusted basis, the Index increased 2% compared with the previous week.
“Mortgage rates followed Treasury yields lower last week, with the 30-year fixed rate declining to 6.09 percent–its lowest level since September 2022,” said Joel Kan, MBA’s vice president and deputy chief economist. “The decrease in rates was enough to drive a five percent increase in conventional refinance applications and a 26 percent increase in VA refinances.”
MBA’s Refinance Index increased 4% from the previous week and was 150% higher than the same week one year ago. The seasonally adjusted Purchase Index decreased 5% from one week earlier. The unadjusted Purchase Index decreased 1% compared with the previous week and was 12% higher than the same week one year ago.
“Purchase applications were down over the week but were 12 percent higher than a year ago, as the combination of lower rates and improving affordability conditions continue to support stronger demand than last year,” Kan added. “The ARM share stayed above 8 percent, as ARM rates remained more than 80 basis points below conforming fixed rates. This is giving payment-sensitive borrowers or those seeking larger loans an incentive to choose this product offering.”
According to MBA’s data this week, the refinance share of mortgage activity increased to 58.6% of total applications from 57.4% the previous week. The adjustable-rate mortgage (ARM) share of activity remained unchanged at 8.2 percent of total applications.
Government-backed loans were mixed this week with MBA showing the FHA share of total applications decreasing to 16.1% from 18.4% the week prior. The VA share of total applications increased to 18.7% from 16.5% the week prior and the USDA share of total applications remained unchanged at 0.4% from the week prior.
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