Mortgage Demand Down 2.7%

Mortgage application activity was down last week, according to the latest data from the Mortgage Bankers Association (MBA).

The Market Composite Index, the MBA’s measure of mortgage loan application volume, decreased 2.7% on a seasonally adjusted basis from one week earlier; the unadjusted index was down 2%.

The seasonally adjusted Purchase Index was down by 1% from one week earlier while the unadjusted index inched up 0.2% — the latter was also 15% lower than the same week one year ago.

The Refinance Index decreased 6% from the previous week and was 3% higher than the same week one year ago. The refinance share of mortgage activity decreased to 30.8% of total applications from 32.1% the previous week.

Among the federal programs, the FHA share of total applications increased to 12.8% from 12.3% the week prior while the VA share of total applications decreased to 11.7% from 12.4% and the USDA share of total applications remained unchanged at 0.4%.

Joel Kan, MBA’s vice president and deputy chief economist, observed, “Purchase applications declined, as home buyers delayed their purchase decisions due to strained affordability and low supply. The ARM share of applications increased to 7.6%, consistent with the upward trend in rates, as buyers look to reduce their potential monthly payments.”