Mortgage application volume increased 0.6% during the week ended Oct. 6, as the average rate for a 30-year fixed-rate mortgage increased to 7.67%, up from 7.53% the previous week, according to the Mortgage Bankers Association’s (MBA) Weekly Applications Survey.
Applications for refinances increased 0.3% compared with the previous week but were down 9% compared with the same week one year ago. Applications for purchases increased 1% compared with the previous week but were down 19% from a year ago.
“While most mortgage rates increased last week, rates on ARMs declined, leading to an increase in ARM volume and an increase in overall applications,” explains Joel Kan, vice president and deputy chief economist for the MBA, in a statement. “The level of ARM applications increased by 15 percent over the week, bringing the ARM share up to 9.2 percent of all applications, the highest since November 2022. The yield curve has become less inverted in recent weeks and ARM pricing has certainly improved.
“The 30-year fixed mortgage rate is at 7.67 percent – the highest level since 2000 and 40 basis points higher than a month ago,” Kan adds. “Application activity remains depressed and close to multi-decade lows, with purchase applications still almost 20 percent behind last year’s pace. Refinance applications also continue to be limited, and the average loan size has fallen to its lowest level since 2017.”
The refinance share of mortgage activity decreased to 31.6% of total applications, down from 31.7% the previous week.
The adjustable-rate mortgage (ARM) share of activity increased to 9.2% of total applications.
The average contract interest rate for a 5/1 ARM was 6.33%, down from 6.49% the previous week.