Weekly purchase application volume is down more than 15% from last year

Overall application volume to lenders was flat last week as potential homebuyers appeared willing to take a wait-and-see approach. Wish for greater affordabilitythe Mortgage Bankers Association said.

The MBA Market Composite Index, which measures weekly application activity based on a survey of members of industry groups, fell for the second consecutive time, falling 0.7% seasonally in the seven adjustment days ended March 22. in previous investigationsthe number of applications fell by 1.6%, while the number fell by 13.4% year-on-year.

“Mortgage application activity remained muted last week despite a slight decline in mortgage rates,” Joel Kan, MBA vice president and deputy chief economist, noted in a release.

The average interest rate on a 30-year fixed mortgage in most markets with balances less than $766,550 fell 4 basis points to 6.93% from 6.97% last week. Borrower points used to purchase rates also fell 4 basis points to 0.6% from 6.97% last week. An application with a loan-to-value ratio of 80% is 0.64.

Kan attributed this week’s slump to consumer hesitancy amid an unpredictable economic environment. “Home purchase applications have been largely unchanged as buyers continue to hold out for lower mortgage rates and more homes on the market,” he said.

As a result, the seasonally adjusted purchase index also fell slightly by 0.2% from the previous survey period, but compared with the same period last year, transaction volume fell by 15.6%, and the real estate market is still feeling the impact of the downturn. The impact of lock-in Discourage homeowners from moving and being saddled with mortgage rates that are much higher than they currently are.

But recent inventory and price indicators suggest that if this trend continues, it could bring some relief to homebuyers. In mid-March, online real estate brokerage Redfin saw a 5% increase in new listings compared with the previous four weeks, the largest 10-month increase in history. Corelogic Case-Shiller and the Federal Housing Finance Agency Home Price Index A small monthly decline was recorded earlier this winter.

Meanwhile, hopes of a rate cut remain. Last week’s Federal Open Market Committee meeting, even though they are unlikely to be as fast or as frequent as many predicted just a few months ago. But comments from Fed Chair Powell suggesting the federal funds rate could eventually be cut appeared to calm investors and dampen the upward momentum seen earlier this month.

“Lower rates should help free up additional inventory as the effects of lockdowns abate, but we expect this to only happen gradually as we forecast rates to rise to 6% by the end of the year,” Kan said.

The MBA Refinancing Index fell 1.6% quarter-to-quarter and also dropped 8.6% compared with the same period last year. The proportion of refinancing applications in total applications fell from 31.2% to 30.8%.

“With interest rates still high, there is currently little incentive for rate/term refinancing,” Kan said.

Seasonally adjusted government-sponsored loan volumes saw a similar-sized decline as the overall market, causing its share of activity to also remain near the prior week’s levels. FHA and VA-guaranteed loans each attracted 12% of total loan volume, each accounting for a 12.1% share 7 days ago. Applications from USDA programs accounted for the same 0.5% share.

Fixed rates from MBA lenders have stabilized or fallen after the last survey showed higher-than-expected inflation in February. The average interest rate on 30-year jumbo mortgage contracts with balances above the qualifying limit remained at 7.14%. However, the score for 80% LTV ratio loans fell from 0.54 to 0.38.

The average FHA-backed 30-year fixed rate fell 14 basis points to 6.75% from 6.89% during the previous survey. The borrowing point fell to 0.97 from 1.04.

The 15-year fixed mortgage contract rate fell 3 basis points to an average of 6.46%, compared with 6.49% seven days ago. But unlike other fixed-rate loans, the interest rate has increased, from 0.7 to 0.75.

The average interest rate on 5/1 adjustable-rate mortgages (with a 60-month term) also ended lower last week, falling 6 basis points to 6.27% from 6.33%. By comparison, borrowers typically use points worth 0.64. The previous weekly survey was 0.55.

All types of adjustable rate mortgages Accounting for 7% of overall activity, down from 7.2% seven days ago.

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