After three weeks of declining activity, a new boost of mortgage applications occurred during the week ending Jun 6, according to data from the Mortgage Bankers Association (MBA).
The Market Composite Index, the MBA’s measure of mortgage loan application volume, increased 12.5% on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the index surged by 23% compared with the previous week.
The seasonally adjusted Purchase Index increased 10% from one week earlier while the unadjusted index rose by 20% – the latter was also 20% higher than the same week one year ago. The Refinance Index increased 16% from the previous week and was 28% higher than the same week one year ago, while the refinance share of mortgage activity increased to 36.7% of total applications from 35.2% the previous week.
Among the federal programs, the FHA share of total applications decreased to 18% from 18.7% the week prior while the VA share of total applications decreased to 11.6% from 12.6% and the USDA share of total applications inched up to 0.6% from 0.5%.
“Coming out of the Memorial Day holiday, mortgage applications increased to the highest level in over a month, driven by growth in both purchase and refinance applications. Treasury rates saw some movement during the week, which resulted in additional opportunities for borrowers,” said Joel Kan, MBA’s vice president and deputy chief economist. “The rate for 15-year fixed rate loans and FHA loans saw declines last week, while the 30-year fixed rate was largely unchanged. Purchase applications were 20% ahead of last year’s pace, continuing to show strength compared to a year ago. Despite ongoing uncertainty surrounding the economy, homebuyers seem to be taking advantage of loosening housing inventory in certain markets.”
