MBA Weekly Mortgage Applications Survey Composite Index Up 41% Annually
Mortgage applications soared 26.8% for the week ending June 7, according to the Mortgage Bankers Association (MBA) Weekly Mortgage Applications Survey. The Composite Index is now up 41% annually.
|Composite Index – W/W ∆||1.5 %||26.8 %|
|Purchase Index – W/W ∆||-2.0 %||10.0 %|
|Refinance Index – W/W ∆||6.0 %||47.0|
The Refinance Index surged 47% for the week. The Purchase Index, which measures applications done with mortgage lenders, rose a very solid 10%. The latter indicates increased strength for home sales.
“Mortgage rates for all loan types fell by a sizeable margin for the second straight week, pulled down by trade tensions with China and Mexico, the financial markets reacting to more bearish communication from several Fed officials, and weaker than expected hiring in May,” said Joel Kan, MBA’s Associate Vice President of Economic and Industry Forecasting.
The average 30-year conventional loan fell 11 basis points for the week to 4.12%, the lowest level since September 2017.
“Despite the less positive outlook, both purchase and refinance applications surged, driven mainly by these lower rates,” Mr. Kan said. “The refinance index jumped 47 percent to its highest level since 2016.”
The refinance share of mortgage activity increased to 49.8% of total applications, up from 42.2% last week. The adjustable-rate mortgage (ARM) share of activity increased to 7.9% of total applications.
“With the 30-year fixed-rate mortgage at its lowest level since September 2017, purchase activity was more than 10 percent higher than a year ago,” Mr. Kan added. “Demand is still relatively strong, but there is likely restraint from some prospective buyers, driven by some economic uncertainty.”
“Furthermore, housing supply is still very tight for first-time buyers.”