Mortgage application volume fell 5.6% during the week ended February 23, as the average rate for a 30-year, fixed-rate mortgage fell to 7.04%, down slightly from 7.06% the previous week, according to the Mortgage Bankers Association’s (MBA) Weekly Applications Survey.
Applications for refinances dropped 7% compared with the previous week and were down 1% compared with the same week one year ago.
Applications for purchases were down 5% compared with the previous week and were down 12% compared with the same week one year ago.
“Mortgage rates were little changed last week, with the 30-year conforming rate declining slightly to 7.04 percent but remaining about a quarter percentage point higher than the start of the year,” says Mike Fratantoni, senior vice president and chief economist for the MBA, in a statement. “Higher rates in recent weeks have stalled activity, and last week it dropped more for those seeking FHA and VA refinances.
“Purchase activity is running 12 percent behind last year’s pace, but our January Builder Application Survey results showed that applications to buy new homes were up 19 percent compared to last year,” Fratantoni adds. “This disparity continues to highlight how the lack of existing inventory is the primary constraint to increases in purchase volume. However, mortgage rates above 7 percent sure don’t help.”
The refinance share of mortgage activity decreased to 31.2% of total applications, down from 32.6% the previous week.
The adjustable-rate mortgage (ARM) share of activity increased to 7.5% of total applications.
Photo: Scott Graham