by Calculated Risk on 9/23/2005 01:00:00 AM

The Mortgage Bankers Association (MBA) reports: Mortgage Applications Steady During Holiday Shortened Week

The Mortgage Bankers Association (MBA) today released its Weekly Mortgage Applications Survey for the week ending September 16. The Market Composite Index — a measure of mortgage loan application volume – was 772.2, an increase of 1.5 percent on a seasonally adjusted basis from 760.6 one week earlier. On an unadjusted basis, the Index increased 11.9 percent compared with the previous week and was up 12.0 percent compared with the same week one year earlier.

What I found puzzling is that refinance activity is still strong, even though rates have been flat or rising for some time:

The refinance share of mortgage activity increased to 45.6 percent of total applications from 42.9 percent the previous week. The adjustable-rate mortgage (ARM) share of activity increased to 29.8 percent of total applications from 28.2 percent the previous week.

It appears homeowners are still pulling equity out of their houses. Also, given the narrow spread between products, I'm surprised at the volume of ARMs.