Purchase applications see strongest data in over a month

The refinance index decreased 4% from the previous week and remained 19% higher than the same week one year ago. The refinance share of mortgage activity also decreased to 45.3% of total applications from 46.1% the previous week.

The seasonally adjusted purchase index increased 2% from one week earlier. The unadjusted purchase index decreased 0.1% compared with the previous week and was 25% higher than the same week one year ago.

“Mortgage rates inched higher for the second straight week, with the 30-year fixed-rate up to 6.69%. While this was not a significant increase, it was enough to cause a pullback in refinance applications,” said Joel Kan, MBA’s vice president and deputy chief economist. “Purchase applications had their strongest week in over a month, up 2%, and the average loan size increased to its highest level in two months at $433,400. Prospective buyers appear to be less sensitive to rates at these levels and are more active, bolstered by more inventory and cooling home-price growth in many parts of the country.”

By application type, the adjustable-rate mortgage (ARM) share of activity decreased to 8.4% of total applications. The FHA share of total applications remained unchanged at 19.1% while the VA share of total applications decreased to 13.3% from 13.4% the week before. The USDA share of total applications decreased to 0.5% from last week’s 0.6%.

As interest rates for 30-year fixed-rate mortgages increased, so did jumbo loan 30-year fixed-rate mortgages, which saw interest rates increase to 6.67% from 6.64%.

The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA, however, decreased to 6.35% from 6.39%. The average contract interest rate for 5/1 ARMs also saw a decrease to 5.94% from 6.01%.

The average contract interest rate for 15-year fixed-rate mortgages increased to 6.03% from 5.96%.