Mortgage and refinance applications continued their downward trend for the third consecutive week, according to new numbers out by the Mortgage Bankers Association.
The MBA reports that the Market Composite Index, a measure of mortgage loan application volume, decreased 3.7 percent on a seasonally adjusted basis for the week ending August 26, 2022. On an unadjusted basis, the Index decreased 5 percent compared with the previous week.
The Refinance Index decreased 8 percent from the previous week and was 83 percent lower than the same week one year ago. The seasonally adjusted Purchase Index decreased 2 percent from one week earlier. The unadjusted Purchase Index decreased 4 percent compared with the previous week and was 23 percent lower than the same week one year ago.
“The 30-year fixed mortgage rate increased for the second week in a row to 5.80 percent, reaching its highest level since mid-July. Mortgage rates and Treasury yields rose last week as Federal Reserve officials indicated that short-term rates would stay higher for longer. Mortgage rates have been volatile over the past month, bouncing between 5.4 percent and 5.8 percent,” said Joel Kan, MBA’s Associate Vice President of Economic and Industry Forecasting. “In another sign that market volatility has picked up, the average rate on a jumbo loan was 5.32 percent, 48 basis points lower than for a conforming loan. This spread reached a high of over 50 basis points in July—and had narrowed – before now widening again.”
The refinance share of mortgage activity decreased to 30.3 percent of total applications from 31.1 percent the previous week.