Despite a slight drop in rates, total mortgage demand fell 11% for the week, according to the Mortgage Bankers Association’s latest weekly survey…(MBA)
- PURCHASES: The Purchase Index was down 12% for the week and is now down 15% year-over-year.
- REFIS: The Refinance Index continued its plummet with a 10% drop and is now down 76% year-over-year.
NOTE: The refinance share of mortgage activity increased to 33.0%of total applications from 32.4% the previous week. The adjustable-rate mortgage (ARM) share of activity actually decreased to 10.3% of total applications from 10.8% the week before.
Mortgage rates saw a slight reprieve for the week ending May 13th…
- 30-YR FIXED: The average contract interest rate was down 4 basis points to 5.49%, this is now 234 basis points higher than one year ago.
- 15-YR FIXED: The average contract interest rate fell 6 basis points to 4.73%, this is now 219 basis points higher than one year ago.
- 5/1 ARM: The average contract interest rate fell 5 basis points to 4.42%, this is now 188 basis points higher than one year ago.
Joel Kan, MBA’s Associate Vice President of Economic and Industry Forecasting, said that uncertainty with the economy could also be contributing to the market slowdown…
- “Mortgage applications decreased for the first time in three weeks, as mortgage rates – despite declining last week – remained over two percentage points higher than a year ago and close to the highest levels since 2009…homebuyers have been put off by higher rates and worsening affordability conditions. Furthermore, general uncertainty about the near-term economic outlook, as well as recent stock market volatility, may be causing some households to delay their home search.”