by Calculated Risk on 2/24/2021 07:00:00 AM

From the MBA: Mortgage Applications Decrease in Latest MBA Weekly Survey

Mortgage applications decreased 11.4 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending February 19, 2021.

... The Refinance Index decreased 11 percent from the previous week and was 50 percent higher than the same week one year ago. The seasonally adjusted Purchase Index decreased 12 percent from one week earlier. The unadjusted Purchase Index decreased 8 percent compared with the previous week and was 7 percent higher than the same week one year ago.

“Mortgage rates have increased in six of the last eight weeks, with the benchmark 30-year fixed rate last week climbing above 3 percent to its highest level since September 2020. As a result of these higher rates, overall refinance activity fell 11 percent to its lowest level since December 2020, but remained 50 percent higher than a year ago,” said Joel Kan, MBA’s Associate Vice President of Economic and Industry Forecasting. “Additionally, the severe winter weather in Texas affected many households and lenders, causing more than a 40 percent drop in both purchase and refinance applications in the state last week.”

Added Kan, “The housing market in most of the country remains strong, with activity last week 7 percent higher than a year ago. The average loan size of purchase applications increased to a record $418,000, in line with the accelerating home-price growth caused by very low inventory levels.”
...
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($548,250 or less) increased to 3.08 percent from 2.98 percent, with points increasing to 0.46 from 0.43 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans. T
emphasis added

Click on graph for larger image.


The first graph shows the refinance index since 1990.

The refinance index has been volatile recently depending on rates.

With near record low rates, the index remains up significantly from last year (but will be down year-over-year in early March - since rates fell sharply at the beginning of the pandemic).

The second graph shows the MBA mortgage purchase index

According to the MBA, purchase activity is up 7% year-over-year unadjusted.

Note: Red is a four-week average (blue is weekly).