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MBA: Mortgage Applications Increase in Latest Weekly Survey

by Calculated Risk on 12/08/2021 07:00:00 AM

From the MBA: Mortgage Applications Increase in Latest MBA Weekly Survey

Mortgage applications increased 2.0 percent from one
week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage
Applications Survey for the week ending December 3, 2021. The previous week’s results included an
adjustment for the Thanksgiving holiday.

… The Refinance Index increased 9 percent from the previous
week and was 37 percent lower than the same week one year ago. The seasonally adjusted Purchase
Index decreased 5 percent from one week earlier. The unadjusted Purchase Index increased 28 percent
compared with the previous week and was 8 percent lower than the same week one year ago.

“Mortgage rates declined for the first time in a month, prompting a pickup in refinancing, with government
refinances increasing more than 20 percent over the week. While the 30-year fixed mortgage rate and 15-
year fixed mortgage rate both declined only one basis point, the FHA rate fell 7 basis points, driving the
surge in government refinances. Borrowers are continuing to act on these opportunities, but if rates trend
higher as MBA is forecasting, the window of opportunity to refinance will continue to get smaller,” said
Joel Kan, MBA’s Associate Vice President of Economic and Industry Forecasting. “The purchase market
was slower last week, with applications falling after four consecutive increases. Activity is still close to the
highest level since March 2021, which is a positive sign as the year comes to an end. Purchase activity
continues to be constrained by a lack of inventory, combined with rapid rates of home-price appreciation
and mortgage rates higher than in 2020.”

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances
($548,250 or less) decreased to 3.30 percent from 3.31 percent, with points decreasing to 0.39 from 0.43
(including the origination fee) for 80 percent loan-to-value ratio (LTV) loans.
emphasis added

Click on graph for larger image.

The first graph shows the refinance index since 1990.

With relatively low rates, the index remains slightly elevated, but down sharply from last year.

The second graph shows the MBA mortgage purchase index

According to the MBA, purchase activity is down 8% year-over-year unadjusted.

Note: Red is a four-week average (blue is weekly).

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