Mortgage application volume jumped 6.9% during the week ended August 2 as the average rate for a 30-year based on closings decreased to 6.55%, down from 6.82% the previous week, according to the Mortgage Bankers Association’s (MBA) Weekly Applications Survey.
Applications for refinances increased 16% compared with the previous week and were up 59% compared with the same week one year ago.
Applications for purchases increased 1% compared with the previous week and were down 11% compared with the same week one year ago.
“Mortgage rates decreased across the board last week and mortgage application volume reached its highest level since January of this year,” says Joel Kan, vice president and deputy chief economist for the MBA, in a statement. “The 30-year fixed rate fell to 6.55 percent, reaching its lowest level since May 2023, following dovish communication from the Federal Reserve and a weak jobs report, which added to increased concerns of an economy slowing more rapidly than expected.
“As a result of lower rates, refinance applications increased across all loan types, particularly for VA loans, and were almost 60 percent higher than it was at this time last year and were at its highest level in two years,” Kan says.
“Despite the downward movement in rates, purchase activity only saw small gains, with an increase in conventional purchase applications offset by decreases in government purchase applications,” Kan adds. “For-sale inventory is beginning to increase gradually in some parts of the country and homebuyers might be biding their time to enter the market given the prospect of lower rates.”
The refinance share of mortgage activity increased to 41.7% of total applications, up from 38.2% the previous week.
The adjustable-rate mortgage (ARM) share of activity increased to 6.3% of total applications.
Photo: Romain Dancre