Mortgage Applications Fell 3.7 Percent Despite Dip in Rates

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Mortgage application volume decreased 3.7% on an adjusted basis during the week ended April 9, with applications for refinances falling 5% and applications for purchases falling 1%, according to data from the Mortgage Bankers Association’s (MBA) Weekly Applications Survey.

Year-over-year, applications for refinances were down 31% while applications for purchases were down 51%.

On an unadjusted basis, total volume decreased 3% compared with the previous week. 

“Purchase and refinance applications declined, with most of the pullback coming earlier in the week when rates were higher,” says Joel Kan, associate vice president of economic and industry forecasting for the MBA, in a statement. “Treasury yields started last week high – close to the prior week’s level at over 1.7 percent – before decreasing six basis points.

“Refinance activity has now decreased for nine of the past 10 weeks, as rates have gone from 2.92 percent to 3.27 percent over the same period,” Kan says. “Last week’s index level was the lowest in over a year, as mortgage rates continue to trend higher. Many borrowers have either already refinanced at lower rates or are unwilling – or unable – to refinance at current rates.

“The third straight week of declining purchase activity is a sign that rising home prices and tight supply are constraining home sales – especially in the lower price tiers,” Kan adds. “Purchase applications were still above last year’s pandemic-impacted low point, but fell behind the level of activity seen the same week in 2019.”

The refinance share of mortgage activity decreased to 59.2% of total applications, down from 60.3% the previous week.

The adjustable-rate mortgage (ARM) share of activity decreased to 3.6% of total applications.

The average rate for a 30-year fixed-rate mortgage, based on closings, was 3.27%, down from 3.36% the previous week.

Photo: Tierra Mallorca

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