Mortgage Apps Decrease 4%

Mortgage applications decreased from one week earlier, according to data from the Weekly Mortgage Applications Survey (Mortgage Bankers Association)

  • The Market Composite Index decreased 4.1% on a seasonally adjusted basis from one week earlier.

Refinances were down 4% from the previous week but were still 46% higher than the same week one year ago.

  • Refis also saw their share of mortgage activity drop to 70.2% of total applications from 71.4% the previous week.

Purchases were down 5% compared with the previous week but were 17% higher than the same week one year ago.

Mortgage rates were up slightly on the average contract interest rate for a 30-year fixed-rate mortgage

  • Rates increased to 2.96% from 2.92% the week before
  • Points also increased to 0.36% from 0.32% the week before

Loan sizes were also up.  The average purchase loan size reached another survey high of $402,200,

Joel Kan, MBA’s Associate Vice President of Economic and Industry Forecasting, said in a statement, “Mortgage rates have increased in four of the first six weeks of 2021, with jumbo rates being the only loan type that saw a decline last week. Despite some weekly volatility, Treasury rates have been driven higher by expectations of faster economic growth as the COVID-19 vaccine rollout continues,”

Lower mortgage rates were the only thing countering the impact of rising prices caused by historically low inventory.  If rates continue to move upwards, some possible homeowners are going to get priced out of the market.