Mortgage application volume increased 1.3% on an adjusted basis during the week ended June 21, as the average rate for a 30-year fixed rate mortgage fell to 4.06%, down from 4.14% the previous week, according to the Mortgage Bankers Association’s (MBA) Weekly Applications Survey.
Applications for refinances increased 3% however applications for purchases decreased 1%.
On an unadjusted basis, total volume increased 1% compared with the previous week.
Applications for purchases decreased 2% on an unadjusted basis but were up 9% compared with the same week one year earlier.
“Markets last week reacted to a more dovish FOMC statement and forecast, with Treasury yields falling after the meeting,” says Joel Kan, associate vice president of economic and industry forecasting for the MBA, in a statement. “Mortgage rates dropped again for most loan types, which led to an increase in refinance activity, partly driven by a nine percent jump in VA applications.
“The 30-year fixed rate has now dropped in three of the last four weeks, and at 4.06 percent, reached its lowest level since September 2017,” Kan adds. “Despite these lower rates, purchase applications decreased two percent, but were still considerably higher than a year ago.
“Now at almost the half-way mark of 2019, we have generally seen a stronger purchase market than last year, despite still-tight existing inventory and insufficient new construction,” he says.
The refinance share of mortgage activity increased to 51.5% of total applications, up from 50.2% the previous week.
The adjustable-rate mortgage (ARM) share of activity increased to 6.5% of total applications.
The average rate for a 5/1 ARM, based on closings, was 3.50%, up from 3.45%.