From the MBA: Mortgage Applications Decrease in Latest MBA Weekly Survey
Mortgage applications decreased 6.4 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending February 14, 2020.
… The Refinance Index decreased 8 percent from the previous week and was 165 percent higher than the same week one year ago. The seasonally adjusted Purchase Index decreased 3 percent from one week earlier. The unadjusted Purchase Index increased 2 percent compared with the previous week and was 10 percent higher than the same week one year ago.
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“Treasury yields moved slightly higher last week, despite uncertainty surrounding the economic impact from the spread of the coronavirus. The 30-year fixed mortgage increased five basis points to 3.77 percent as a result, causing refinance applications – driven by a 11 percent drop in applications for conventional refinances – to fall,” said Joel Kan, MBA’s Associate Vice President of Economic and Industry Forecasting. “Even with an 8 percent decline, the refinance index was still at its third highest reading so far this year. Government refinance activity, which tends to lag movements in the conventional market, bucked the overall trend, as VA loan refinances jumped 23 percent.”Added Kan, “Purchase applications fell 3 percent last week, as there continues to be some pullback after a strong January. Activity was still 10 percent higher than a year ago, but too few options – especially at the lower portion of the market – are slowing some would-be buyers.”
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The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($510,400 or less) increased to 3.77 percent from 3.72 percent, with points remaining unchanged at 0.28 (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 lower rates, we saw a sharp increase in refinance activity, but mortgage rates would have to decline further to see a 2012 size refinance boom.
The second graph shows the MBA mortgage purchase index
According to the MBA, purchase activity is up 10% year-over-year.