Mortgage applications increase in the latest weekly survey

by Calculated risk on 9/21/2022 07:00:00 AM

From MBA: Mortgage Applications Increase in Latest Weekly MBA Survey

Mortgage applications increased 3.8 percent from the previous week, according to the Mortgage Bankers Association (MBA) weekly mortgage application survey data for the week ending September 16, 2022. Last week’s results include an adjustment for the Labor Day holiday.

…the refinancing index is up 10 percent from the previous week and down 83 percent from the same week a year ago. The seasonally adjusted purchasing index was up 1 percent from the previous week. The unadjusted purchasing index rose 11 percent from the previous week and was 30% less than the same week one year ago.

Treasury yields continued to climb last week in anticipation of the Federal Reserve’s September meeting, when they are expected to announce – in their efforts to slow inflation – another significant increase in short-term interest rates. Mortgage rates followed suit last week, rising across the board, as the 30-year fixed rate jumped 24 basis points to 6.25 percent — the highest level since October 2008, said Joel Kahn, associate vice president for economic and industrial forecasts at MSc. Business Management. “As with price volatility and other uncertainties about the housing market and the broader economy, mortgage applications increased for the first time in six weeks but remained well below last year’s levels, with purchase orders down 30 percent and refinancing activity 83 percent. Weekly gains in orders, despite higher rates, confirm general volatility for the time being as well as revised results for the previous week’s business day.”

The average contract interest rate for 30-year fixed-rate mortgages with matching loan balances ($647,200 or less) increased to 6.25 percent from 6.01 percent, with points dropping to 0.71 from 0.76 (including creation fees) for 80 percent loan to loan value ratio (LTV).
Confirmations added

Click on the chart for a larger picture.

The first chart shows the refinancing index since 1990.

With mortgage rates rising, the refinancing index has fallen sharply this year.

The refinancing index is just above the lowest level since 2000.

The second chart shows the MBA Mortgage Purchase Index

Mortgage Buying Index
According to the MBA, purchasing activity is down 30% year-over-year, unadjusted.
The buy index is only 10% above the epidemic low.

Note: Red averages four weeks (blue weekly).

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