Mortgage Apps: Rate Sensitivity For Purchase Applications
July 11, 2018
Bottom Line: Amid summer volatility and difficult seasonal adjustments due to holidays, the underlying trend in mortgage purchase applications is showing continued sensitivity to 30-year mortgage rates. As the average reported 30-year fixed-rate backed away from nearly 5% and stabilized around 4.75% in the last few weeks, purchase application volume picked up modestly. Overall the trend for total applications remains down, mostly due to continued declines in already slow refinancing activity, while the trend in purchase applications is still mixed to slightly higher. With other housing metrics suggesting a slightly softer summer selling season, this trend in purchase volume bears watching.
The MBA Mortgage Applications Index ROSE by 2.5% during the week ended July 6 to 372.6, slightly below its 13 week average of 376.5 and 4.9% BELOW its year ago level.
The Purchase Index ROSE by 6.5% to 261.5, modestly above its 13 week average of 253.5 and 7.7% ABOVE its year ago level.
The Refinance Index FELL by 3.8% to 959. With this decline, refinancing activity is moderately below its 13 week average of 1,044 and 20.8% BELOW its year ago level.
Contract Mortgage Rates FELL with the 30-year fixed rate declining by 3 bps to 4.76% and with the 15-year fixed rate declining by 4 bps to 4.18%.
Article by Contingent Macro Advisors