Mortgage application volume dipped 1.2% during the week ended May 23, as the average rate for a 30-year, fixed-rate mortgage increased to 6.98%, up from 6.92% the previous week, according to the Mortgage Bankers Association’s (MBA) Weekly Applications Survey.
Applications for refinances decreased 7% compared with the previous week but were up 37% compared with the same week one year ago.
Applications for purchases increased 3% compared with the previous week and were up 18% compared with the same week one year ago.
“Mortgage rates reached their highest level since January, following higher Treasury yields,” says Joel Kan, vice president and deputy chief economist for the MBA, in a statement. “Additional market volatility has added to the increase, keeping the mortgage-Treasury spread wider than it was earlier this year. The 30-year fixed rate increased to 6.98 percent, its third consecutive weekly increase.”
“As a result of these higher rates, applications activity decreased, driven by a 7 percent decline in refinance applications,” Kan adds. “Conventional refinances were down 6 percent, and VA refinances dropped 16 percent. Purchase applications were up over the week and continue to run ahead of last year’s pace as increased housing inventory in many markets has been supporting some transaction volume, despite the economic uncertainty.”
The refinance share of mortgage activity decreased to 34.6% of total applications, down from 36.6% the previous week.
The adjustable-rate mortgage (ARM) share of activity increased to 7.5% of total applications.
Photo: Ben Mullins