Mortgage applications decreased 6.5% on a seasonally adjusted basis from one week ago, according to Market Composite Index data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending June 3.
This week’s results include an adjustment for the Memorial Day holiday. On an unadjusted basis, the index decreased 17% compared with the previous week.
The Refinance Index decreased 6% from the previous week and was 75% lower than the same week one year ago. The seasonally adjusted Purchase Index decreased 7% from one week earlier. The unadjusted Purchase Index decreased 18% compared with the previous week and was 21% lower than the same week one year ago.
“Weakness in both purchase and refinance applications pushed the market index down to its lowest level in 22 years. The 30-year fixed rate increased to 5.4 percent after three consecutive declines. While rates were still lower than they were four weeks ago, they remain high enough to still suppress refinance activity. Only government refinances saw a slight increase last week,” says Joel Kan, MBA’s associate vice president of economic and industry forecasting. “The purchase market has suffered from persistently low housing inventory and the jump in mortgage rates over the past months. These worsening affordability challenges have been particularly hard on prospective first-time buyers.”
The refinance share of mortgage activity increased to 32.2% of total applications from 31.5% the previous week. The adjustable-rate mortgage (ARM) share of activity decreased to 8.2% of total applications.
The FHA share of total applications increased to 11.3% from 10.8% the week prior. The VA share of total applications increased to 11.4% from 10.2% the week prior. The USDA share of total applications remained unchanged at 0.5% the week prior.