Mortgage Apps: Refi Slide Continues, Purchases Edge Higher

Bottom Line:  Mortgage rates averaged over 5.25% last week, adjusted for points paid, sending applications for refinancing sharply lower. Purchase applications, though, edged slightly higher. As we've noted in previous weeks, purchase applications have held up better than would have been expected historically given the rate move. But the trend for purchase applications is still to the downside and will likely remain so as long as primary mortgage rates hold over 5%. On the positive side, current coupon yields in the secondary market have come down in the last two days after hitting a local high on Monday amid wider spreads to Treasuries. Overall, the trend in mortgage applications is lower as housing activity slowly cools in response to higher rates.The MBA Mortgage Application Index FELL slightly, DOWN -1.3% to 394.0, BELOW the 13-week average of 498.0, and -41.1% BELOW the year-ago level. Non-seasonally adjusted the index was nearly unchanged, DOWN -0.5%.
 
The Purchase Index ROSE 1.4% to 262.0, BELOW the 13-week average of 274.0 and -6.3% BELOW the year-ago level.
 
The Refinancing Index FELL -4.9% to 1109.0, BELOW the 13-week average of 1758.0 and -62.0% BELOW the year-ago level.
 
The effective (adjusted for points paid) 30-year mortgage rate ROSE sharply, UP 25bps to 5.31%, ABOVE the 13-week average of 4.37%, and 58bps ABOVE the year-ago level.