Mortgage application activity was flat in the latest data report from the Mortgage Bankers Association (MBA) covering the week ending Oct. 25.
The Market Composite Index, the MBA’s measure of mortgage loan application volume, dipped by 0.1% on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the index was down by 1% compared with the previous week.
The seasonally adjusted Purchase Index increased 5% from one week earlier while the unadjusted index was up by 4% – the latter was also 10% higher than the same week one year ago. The Refinance Index fell 6% from the previous week but was also 84% higher than the same week one year ago; the refinance share of mortgage activity decreased to 43.1% of total applications from 45.7% the previous week.
Among the federal programs, the FHA share of total applications decreased to 16.4% from 16.9% the week prior while the VA share of total applications decreased to 14.6% from 15.8% and the USDA share of total applications remained unchanged at 0.4%.
Joel Kan, MBA’s vice president and deputy chief economist, declared, “After a brief burst of activity in September when rates were almost 60 basis points lower, overall applications have declined 27%, driven by a pullback in refinances. Government refinances accounted for a large part of the decrease, dropping 12% over last week. Purchase applications increased compared to a holiday-shortened week and were 10% higher than a year ago. While near-term purchase application activity has weakened, we continue to expect housing demand from younger homebuyers to support purchase growth over the next few years as for-sale inventory loosens gradually.”
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