Mortgage loan application volume fell 5.1% week over week, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey.

The MBA’s composite index posted a 5.1% seasonally adjusted decline. On an unadjusted basis, it was down 4% week over week.

“Expectations of faster economic growth and inflation continue to push Treasury yields and mortgage rates higher. Since hitting a survey low in December, the 30-year fixed rate has slowly risen, and last week climbed to its highest level since November 2020,” said Joel Kan, MBA’s AVP of economic and industry forecasting. “The uptick in rates has slightly dampened refinance activity, with MBA’s index falling for the second week in a row, and the overall share dipping below 70% for the first time since last October.”  

The average contract interest rate for 30-year fixed mortgages with conforming loan balances ($548,250 or less) jumped to 2.99% from 2.96%. Thirty-year fixed mortgages with jumbo loan balances hovered at 3.11%. 

The refinance share of mortgage activity decreased to 69.3% of total applications, while adjustable-rate mortgage applications increased to 2.4% of totals.
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“The housing market in early 2021 continues to be constrained by low inventory and higher prices,” Kan said. “Conventional and government applications to buy a home declined last week, but purchase activity overall is still strong, up 15% from last year. The average purchase loan size hit another survey high at $412,200, partly due to a larger drop in FHA applications, which tend to have smaller-than-average loan sizes.” 

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The number of mortgage applications fell for the sixth consecutive week, according to new data from the Mortgage Bankers Association (MBA).

Figures from MBA revealed that the total number of mortgage applications decreased 3.7% for the week ending April 09, on a seasonally adjusted basis, compared to the week prior.

Refinancing activity also decreased last week, dropping 5% from the previous week, while the seasonally adjusted purchase index decreased 1% week-over-week.

Joel Kan, associate vice president of economic and industry forecasting at MBA, said that the decrease could be attributed to rising rates and a tighter supply of homes.

“Purchase and refinance applications declined, with most of the pullback coming earlier in the week when rates were higher,” said Kan. “Refinance activity has now decreased for nine of the past 10 weeks, as rates have gone from 2.92% to 3.27% over the same period. Last week’s index level was the lowest in over a year, as mortgage rates continue to trend higher. Many borrowers have either already refinanced at lower rates or are unwilling – or unable – to refinance at current rates.”

Additionally, Kan said that declining purchase activity is “a sign that rising home prices and tight supply are constraining home sales – especially in the lower price tiers.”

“Purchase applications were still above last year’s pandemic-impacted low point, but fell behind the level of activity seen the same week in 2019,” concluded Kan.

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Activity has not yet picked up during this time.

The usual trend of shrinking mortgage applications continued for the week ending April 15.

Overall mortgage applications dropped 5% on a seasonally adjusted basis – 4% if unadjusted – from one week earlier, according to the Mortgage Bankers Association (MBA).

Likewise, both refinance and purchase applications were also 8% and 3% lower than the previous week, respectively. Both percentages are significantly lower compared to the same time last year.

Joel Kan, associate vice president of economic and industry forecasting at MBA, said rapid inflation and tight monetary policies had pushed mortgage rates through the roof.

“The 30-year rate has increased 70 basis points over the past month and is two full percentage points higher than a year ago. The recent surge in mortgage rates has shut most borrowers out of term refinances, causing the refinance index to fall for the sixth consecutive week,” Kan said. “In a housing market facing affordability challenges and low inventory, higher rates are causing a pullback or delay in home purchase demand as well. Home purchase activity has been volatile in recent weeks and has yet to see the typical pick up for this time of the year.”

Meanwhile, the refinance share of mortgage activity also decreased to 35.7% from 37.1% the previous week. Only the adjustable-rate mortgage (ARM) share increased to 8.5% of total applications – the highest level since 2019.

“ARM loans typically have lower rates than fixed rate mortgages,” Kan said. “As this spread has widened, ARM loans have become more attractive to borrowers already facing home purchase loan amounts close to record highs.”

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