Mortgage applications decreased 4.6 percent from one week
earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications
Survey for the week ending May 19, 2023.
The Market Composite Index, a measure of mortgage loan application volume, decreased 4.6 percent on
a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased 5
percent compared with the previous week. The Refinance Index decreased 5 percent from the previous
week and was 44 percent lower than the same week one year ago. The seasonally adjusted Purchase
Index decreased 4 percent from one week earlier. The unadjusted Purchase Index decreased 5 percent
compared with the previous week and was 30 percent lower than the same week one year ago.
“Mortgage applications declined almost five percent last week as borrowers remained sensitive to higher
rates. The 30-year fixed rate increased to 6.69 percent, the highest level since March,” said Joel Kan,
MBA’s Vice President and Deputy Chief Economist. Since rates have been so volatile and for-sale
inventory still scarce, we have yet to see sustained growth in purchase applications. Refinance activity
remains limited, with the refinance index falling to its lowest level in two months and more than 40 percent
below last year’s pace.”
Added Kan, “Investors remained attuned to the uncertainty around the U.S. debt ceiling and
communication from several Federal Reserve officials last week, which sent Treasury yields higher, along
with mortgage rates. Economic data released over the past week have also pointed to a still-resilient
economy. The housing market received positive data on new residential construction – which is seen as a
key solution to the lack of housing inventory.”
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances
($726,200 or less) increased to 6.69 percent from 6.57 percent, with points increasing to 0.66 from 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 30% year-over-year unadjusted.