July 23, 2024

MBA: Mortgage Applications Fell 2.3 Percent Last Week as Rates Continued to Rise

Mortgage application volume decreased 2.3% during the week ended April 26, as the average rate for a 30-year, fixed-rate mortgage increased to 7.29%, up from 7.24% the previous week, according to the Mortgage Bankers Association’s (MBA) Weekly Applications Survey

Applications for refinances decreased 3% compared with the previous week and were down 1% compared with the same week one year ago. 

Applications for purchases decreased 2% compared with the previous week and were down 14% compared with the same week one year ago.

“Inflation remains stubbornly high, and this trend is convincing markets that rates, including mortgage rates, are going to stay higher for longer,” says Mike Fratantoni, senior vice president and chief economist for the MBA, in a statement. “No doubt, this is a headwind for the housing and mortgage markets, with the 30-year fixed mortgage rate increasing to 7.29 percent last week, the highest level since November 2023.”

“Application volume for both purchase and refinances declined over the week and remain well below last year’s pace,” Fratantoni adds. “One notable trend is that the ARM share has reached its highest level for the year at 7.8 percent. Prospective homebuyers are looking for ways to improve affordability, and switching to an ARM is one means of doing that, with ARM rates in the mid-6 percent range for loans with an initial fixed period of five years.”

The refinance share of mortgage activity decreased to 30.2% of total applications, down from 30.8% the previous week.

The adjustable-rate mortgage (ARM) share of activity increased to 7.8% of total applications.

Photo: Scott Graham

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