MBA Weekly Survey Reports a Surge in Mortgage Applications

Last Updated on January 27, 2024 by Robert C. Hoopes

Mortgage Applications Show Moderate Increase Last Week

Data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey reveals a 3.7% increase in mortgage applications from the previous week. This increase is measured by the Market Composite Index, which reflects mortgage loan application volume on a seasonally adjusted basis.

Interestingly, while overall mortgage applications saw a boost, refinance applications remained stagnant at low levels. Homeowners seemingly had little motivation to refinance due to the current interest rates. As a result, the refinance share of mortgage activity decreased from 37.5% to 32.7% of total applications. With interest rates showing few signs of dropping further, homeowners are evidently not enticed to explore refinancing options.

On the other hand, purchase activity experienced growth, thanks to conventional and Federal Housing Administration (FHA) purchase applications. This increase in purchase activity somewhat offset the decline in refinance applications seen last week.

In terms of interest rates, the average contract interest rate for 30-year fixed-rate mortgages recorded a slight increase for conforming and jumbo loan balances. Similarly, interest rates for FHA-backed mortgages also rose, albeit marginally. However, the average contract interest rate for 15-year fixed-rate mortgages saw a more noticeable increase. Conversely, the rate for 5/1 ARMs decreased slightly.

It is worth noting that the survey conducted by MBA has been capturing over 75% of all U.S. retail residential mortgage applications for the past three decades. With its extensive coverage, the survey becomes an important tool for evaluating the fluctuating trends in the mortgage market.

While the data suggests that the housing market remains resilient, it is crucial to keep an eye on how interest rates and other factors continue to impact mortgage applications and homeownership trends in the coming weeks.