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Mortgage Apps: Rebound Amid Brief Rate Reprieve

March 9, 2022
Bottom Line:    Mortgage applications rose after three straight weeks of declines as mortgage rates fell slightly, dipping back below 4.25% for the effective average 30yr fixed mortgage. But the trends in applications for refinancing and purchases remain lower, and we often see homebuyers and potential refinancers who missed lower rates, submit applications at the first sign of any reprieve in a move to higher rates. Interest rate volatility remains high. Current coupon yields in the secondary market were down -16.0 bps last week, closing at 2.76%, but were up 16.0 bps this week through Tuesday. Overall, the housing market remains tight but the historic mortgage rate volatility will discourage many homebuyers.
The MBA Mortgage Application Index ROSE sharply , UP 8.5% to 502.0, BELOW the 13-week average of 557.0 and -35.9% BELOW the year-ago level. Non-seasonally adjusted the index ROSE 9.5%.
The Purchase Index ROSE sharply , UP 8.6% to 268.0, BELOW the 13-week average of 284.0 and -7.4% BELOW the year-ago level.
The Refinancing Index ROSE 8.5% to 1830.0, BELOW the 13-week average of 2142.0 and -50.0% BELOW the year-ago level.
The effective (adjusted for points paid) 30-year mortgage rate FELL -6bps to 4.22%, ABOVE the 13-week average of 3.82% and 25bps ABOVE the year-ago level
Article by Contingent Macro Advisors