Mortgage applications surged a surprising 4.9% during the week ended Oct. 19, as the average rate for a 30-year rose to 5.11%, up from 5.10% the previous week to reach the highest level since February 2011, according to the Mortgage Bankers Association’s (MBA) Weekly Applications Survey.
The increase follows three consecutive weeks of falling volume.
Applications for refinances increased a surprising 10% compared with the previous week. Applications for purchases increased 2%.
On an unadjusted basis, total volume increased 5%. Applications for purchases increased 2% on an unadjusted basis and were up 0.2% compared with the same week one year earlier.
“Mortgage application activity rebounded the week following the Columbus Day holiday, but both purchase and refinance levels remained lower than where they were two weeks ago,” says Joel Kan, assistant vice president of economic and industry forecasting for the MBA, in a statement. “The holiday impacted refinance applications more than purchases, as refinances rebounded almost 10 percent.
“Meanwhile, purchase applications increased two percent over the prior week but were still four percent lower than two weeks ago – a sign that both the jump in mortgage rates and tight inventory continue to hold back application activity,” Kan says. “Mortgage rates increased over the week for most loan types, with most rates remaining at seven-year highs.”
The refinance share of mortgage activity increased to 39.8% of total applications, up from 38.1% the previous week.
The adjustable-rate mortgage (ARM) share of activity decreased to 7.0% of total applications.
