Rising mortgage rates continued to discourage refinance application activity but purchase volume still runs ahead of 2020's activity so far, the Mortgage Bankers Association said.
The Market Composite Index, a measure of mortgage loan application volume, decreased 1.3% from
But home purchase applications jumped 7% on a seasonally adjusted basis and 9% on an unadjusted basis compared with last year.
Mortgage rates surged 40 basis points since the start of 2021, driven by faster than expected economic growth,
"With the spring buying season at the doorstep, the purchase market had its strongest showing in four weeks, with gains in both conventional and government applications," Kan added. "Loan sizes moderated for the second straight week — potentially a sign that more first-time buyers are entering the market."
Compared with the same week last year, the unadjusted Market Composite Index was down 32%, with refis down 43% but purchases up 2%.
The refinance application share decreased to 64.5% of total volume, compared with 67.5% the previous week.
The adjustable-rate mortgage share of activity increased to 3%. By product type, Federal Housing Administration made up 11.6% of this week's applications, with Veterans Affairs loans at 11.1% and U.S. Department of Agriculture/Rural Housing Service was 0.4%.
One week ago, the FHA share was 12.1%, VA was 12.3% and USDA/RHS was 0.4%.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($548,250 or less) increased to 3.26% from 3.23%.
The average contract interest rate for jumbo loans — those over $548,250 in value — increased to 3.34% from 3.33%. The average contract interest rate the 30-year FHA-insured mortgage increased to 3.2% from 3.19%.
However, the average contract interest rate for 15-year FRMs decreased to 2.63% from 2.64%. And the average contract interest rate for 5/1 ARMs decreased by 15 basis points to 2.69% from 2.84%, with points decreasing to 0.37 from 0.58.
