Mortgage applications saw a 2.7% increase this week, from one week earlier, according to the latest Weekly Mortgage Applications Survey from the Mortgage Bankers Association’s (MBA) for the week ending November 11, 2022. This week’s results include an adjustment for the observance of Veterans Day.
This week’s numbers:
- The Market Composite Index, a measure of mortgage loan application volume, increased 2.7% on a seasonally adjusted basis from one week earlier.
- On an unadjusted basis, the Index decreased 10% compared with the previous week.
- The Refinance Index decreased 2% from the previous week and was 88% lower than the same week one year ago.
- The seasonally adjusted Purchase Index increased 4% from one week earlier.
- The unadjusted Purchase Index decreased 10% compared with the previous week and was 46% lower than the same week one year ago.
- The refinance share of mortgage activity decreased to 27.6% of total applications from 28.1% the previous week.
- The adjustable-rate mortgage (ARM) share of activity decreased to 10.6% of total applications.
- The FHA share of total applications increased to 13.5% from 13.3% the week prior.
- The VA share of total applications increased to 10.6% from 10.3% the week prior.
- The USDA share of total applications increased to 0.6% from 0.5% the week prior.
- The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($647,200 or less) decreased to 6.90% from 7.14%, with points decreasing to 0.56 from 0.77 (including the origination fee) for 80% loan-to-value ratio (LTV) loans. The effective rate decreased from last week.
- The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $647,200)increased to 6.51% from 6.50%, with points decreasing to 0.64 from 0.78 (including the origination fee) for 80% LTV loans. The effective rate decreased from last week.
- The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA increased to 6.93% from 6.86%, with points decreasing to 0.99 from 1.37 (including the origination fee) for 80% LTV loans. The effective rate decreased from last week.
- The average contract interest rate for 15-year fixed-rate mortgages decreased to 6.27% from 6.40%, with points decreasing to 0.73 from 1.13 (including the origination fee) for 80% LTV loans. The effective rate decreased from last week.
- The average contract interest rate for 5/1 ARMs decreased to 5.73% from 5.87%, with points decreasing to 0.65 from 0.92 (including the origination fee) for 80% LTV loans. The effective rate decreased from last week.
Kan’s take:
“Mortgage rates decreased last week as signs of slower inflation pushed Treasury yields lower. The 30-year fixed rate saw the largest single-week decline since July 2022, dropping to 6.9%,” said Joel Kan, MBA’s vice president and deputy chief economist. “Application activity, adjusted to account for the Veterans Day holiday, increased in response to the drop in rates–driven by a 4% rise in home purchase applications.
“Purchase applications increased for all loan types, and the average purchase loan dipped to its smallest amount since January 2021. Refinance activity remained depressed, down 88% over the year. There is very little refinance incentive with rates so much higher than last year,” Kan concluded.
