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Mortgage Apps: Rates Hit 5-Month Lows

April 19, 2017

Bottom Line: The average 30-year mortgage rate fell to 4.22%, the lowest since mid-November. While purchase applications fell in the week ended April 14th, there is no seasonal adjustment for the Good Friday. Thus, we wouldn't read anything into the trend from the decline. The trend remains modestly stronger for purchase applications, while applications for refinancing remain very low. That said, we are watching both closely as rates near five month lows.

The MBA Mortgage Applications Index FELL by 1.8% during the week ended April 14 to 395.6, slightly below its 13 week average of 396.1 and 24.9% BELOW its year ago level.

The Purchase Index FELL by 3.4% to 238.3, slightly above its 13 week average of 234.7 but 1.0% BELOW its year ago level. The level of purchase activity had stayed quite low after the crisis until 2015 when it started to rise. That trend lost momentum in mid-2016 but has now started to rise again, despite higher mortgage rates.

The Refinance Index ROSE by 0.2% to 1,275. Despite this increase, refinancing activity is slightly below its 13 week average of 1,295 and 41.5% BELOW its year ago level.

Contract Mortgage Rates FELL with the 30-year fixed rate declining by 6 bps to 4.22% and with the 15-year fixed rate declining by 1 bp to 3.50%.

Article by Contingent Macro Advisors