Mortgage applications decreased 5.7 percent from one week
earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications
Survey for the week ending May 12, 2023.
The Market Composite Index, a measure of mortgage loan application volume, decreased 5.7 percent on
a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased 6
percent compared with the previous week. The Refinance Index decreased 8 percent from the previous
week and was 43 percent lower than the same week one year ago. The seasonally adjusted Purchase
Index decreased 4.8 percent from one week earlier. The unadjusted Purchase Index decreased 5 percent
compared with the previous week and was 26 percent lower than the same week one year ago.
“Mortgage rates increased last week even as Treasury yields were essentially flat, with the spread
between the two rates widening to 310 basis points. Mortgage application activity slowed, as most
mortgage rates in the survey increased, with the 30-year fixed rate jumping nine basis points to its highest
level in two months at 6.57 percent,” said Joel Kan, MBA’s Vice President and Deputy Chief Economist.
“Purchase applications decreased 5 percent to its slowest pace in a month, as buyers remain wary of this
rate volatility, but also as for-sale inventory in many parts of the country remains scarce.
Added Kan, “Refinance applications accounted for 27 percent of all applications and dropped almost 8
percent last week. Most borrowers have lower rates on their mortgages, and those who are in the market
are extremely rate sensitive.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances
($726,200 or less) increased to 6.57 percent from 6.48 percent, with points remaining at 0.61 (including
the origination fee) for 80 percent loan-to-value ratio (LTV) loans.
Click on graph for larger image.
The first graph shows the MBA mortgage purchase index.
According to the MBA, purchase activity is down 26% year-over-year unadjusted.