Mortgage applications surged by 10.4% from the previous week, as reported in the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending January 12, 2024. The results for the prior week were adjusted to accommodate the New Year’s holiday.
Key Highlights:
The Market Composite Index, measuring mortgage loan application volume, rose by 10.4% on a seasonally adjusted basis and 26% on an unadjusted basis compared to the previous week.
The Refinance Index increased by 11% from the previous week, marking a 10% gain compared to the same week one year ago.
The seasonally adjusted Purchase Index saw a 9% increase from the previous week, while the unadjusted Purchase Index rose by 28% compared to the prior week but was 20% lower than the same week last year.
Joel Kan, MBA’s Vice President and Deputy Chief Economist, noted a decline in mortgage rates across all loan types, attributing it to lower Treasury yields. The 30-year fixed mortgage rate dropped to 6.75%, the lowest in three weeks.
The refinance share of mortgage activity decreased to 37.5% from 38.3% the previous week, while the adjustable-rate mortgage (ARM) share increased to 5.9%.
The FHA share of total applications decreased to 14.3%, the VA share decreased to 14.2%, and the USDA share increased to 0.5%.
Average contract interest rates for various loan types showed a decline, with the 30-year fixed-rate mortgages at 6.75%, 30-year fixed-rate jumbo mortgages at 6.86%, and 30-year fixed-rate FHA mortgages at 6.46%.
The average contract interest rate for 15-year fixed-rate mortgages decreased to 6.24%, and for 5/1 ARMs, it decreased to 6.14%.
MBA remains cautiously optimistic about an increase in home purchases if rates continue to ease in the coming months.