Mortgage Apps: Lower Again

Bottom Line:  Applications for purchases and refinancing fell last week as the number of refi applications neared historic lows. Purchase applications remain our focus as they've 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 long as primary mortgage rates hold over 5%. Rates were higher still this week - current coupon yields in the secondary market were up 8.0 bps last week, closing at 3.98%, and were up 11.0 bps this week through Tuesday. On the plus side, current coupon yield spreads to Treasuries have yet to break out to new highs, keeping the mortgage rate moves contained to the what you see in the Treasury market. Overall, the trend in mortgage applications is lower as housing activity slowly cools in response to higher rates.The MBA Mortgage Application Index FELL -5.0% to 374.0, BELOW the 13-week average of 481.0 and -48.4% BELOW the year-ago level. Non-seasonally adjusted the index FELL -4.1%.
 
The Purchase Index FELL -3.0% to 254.0, BELOW the 13-week average of 270.0 and -14.0% BELOW the year-ago level.
 
The Refinancing Index FELL -7.7% to 1023.0, BELOW the 13-week average of 1662.0 and -68.2% BELOW the year-ago level.
 
The effective (adjusted for points paid) 30-year mortgage rate ROSE 8bps to 5.39%, ABOVE the 13-week average of 4.49% and 63bps ABOVE the year-ago level.