The MBA Mortgage Applications Index FELL by 4.1% during the week ended February 14 to 380.9. With this decline, mortgage applications are slightly below their 13 week average of 386.3 and 51.3% BELOW their year ago level. On a longer term basis, mortgage applications were rising, albeit amid moderate volatility, since early 2011, and peaked in May, but then the trend topped out and begun a steady retreat.
The Purchase Index FELL by 6.3% to 160.7. With this decline, purchase activity is sharply below its 13 week average of 179.1 and is 16.3% BELOW its year ago level. The level of purchase activity has stayed quite low, amid moderate volatility, since May 2010.
The Refinance Index FELL by 2.7% to 1,645. Despite this decline, refinancing activity is modestly above its 13 week average of 1,597 but is still 61.3% BELOW its year ago level. This sub-index was on a rising trend, albeit amid substantial volatility until May 2013, but then the trend topped out and begun a steady retreat.
Contract Mortgage Rates ROSE with the 30-year fixed rate increasing by 5 bps to 4.50% and with the 15-year fixed rate increasing by 6 bps to 3.55%. Mortgage rates are up modestly, but are still slightly below their highs in early September.
Bottom Line: Mortgage activity fell modestly in the latest week, declining for the 8th time in the last 13 weeks. Applications have dropped by 59.7% over the past nine months, coincident with an increase in mortgage rates. Applications were on a rising trend, albeit amid substantial volatility, for a year-and-a-half, and peaked in May, but then the trend topped out and began steadily retreating. Home buying declined modestly and the 4-week average has weakened modestly since May. Refinancing activity declined for the 7th week in the last 13 weeks, due to the recent higher interest rates.