Mortgage application activity recorded a healthy upswing in new data from the Mortgage Bankers Association (MBA) covering the week ending Aug. 9.
The Market Composite Index, the MBA’s measure of mortgage loan application volume, increased 16.8% on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the index was up by an even 15%.
The seasonally adjusted Purchase Index increased 3% from one week earlier while the unadjusted index increased 2% – the latter was also 8% lower than the same week one year ago.
The Refinance Index increased by a vibrant 35% from the previous week and was a whopping 118% higher than the same week one year ago. The refinance share of mortgage activity jumped to 48.6% of total applications from 41.7% one week before.
The adjustable-rate mortgage share of activity increased to 7.3% of total applications. Among the federal programs, the FHA share of total applications inched up to 13.5% from 13.4% the week prior while the VA share of total applications increased to 16.8% from 14.3% and the USDA share of total applications dipped to 0.3% from 0.4%.
“Rates on both 30- and 15-year fixed-rate mortgages decreased for the second consecutive week, and combined with the previous week’s rate moves, spurred another strong week for application activity as borrowers with higher rates took the opportunity to refinance,” said Joel Kan, MBA’s vice president and deputy chief economist. “Overall applications increased almost 17% to the highest level since January 2023, driven by a 35% increase in refinance applications. The refinance index also saw its strongest week since May 2022 and was 117% higher than a year ago, driven by gains in conventional, FHA, and VA applications. Additionally, purchase applications increased by 3%, with small gains seen across the various loan types, indicating that prospective homebuyers are slowly reentering the market.”
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