Search

For Mortgage Apps, It's Now Officially a Buyer's Market

by devteam May 7th, 2014 | Share

It officiallyrnbecame a buyers’ market in mortgage applications during the week ended Mayrn2.  The Mortgage Bankers Association saidrnthat applications for home purchase mortgages dominated the market by a whiskerrnas applications for refinancing made up less than half of all applications forrnthe first time since 2009. </p

Mortgagernactivity increased from the previous week, moving higher for the first timernsince early April.  The Market CompositernIndex, a measure of application volume, increased 5.3 percent on a seasonallyrnadjusted basis from the week ended April 25 and was up 6 percent on anrnunadjusted basis.  Even as the marketrnshare for refinancing decreased from 50 percent to 49 percent the absoluternnumber of applications increased, driving the Refinancing Index up by 2 percentrncompared to the previous week.  ThernPurchase Index also rose, up 9 percent on a seasonally adjusted basis from arnweek earlier and 10 percent on an unadjusted basis.  The unadjusted index was down 16 percent fromrnthe same week in 2013.</p

Refinance Index vs 30 Yr Fixed</p

ChartManager.loadChart(‘refiappschart’, ‘RefiMtgAppChart’);

</p

Purchase Index vs 30 Yr Fixed</b</p

ChartManager.loadChart(‘purchaseappschart’, ‘PurchaseMtgAppChart’);

</p

“It is official: we are in a majorityrnpurchase market for the first time since 2009,”rnsaid Mike Fratantoni, MBA’s Chief Economist. “A sizeablernincrease in purchasernapplications last week likely reflected the impact of somewhatrnlower mortgage rates as wellrnas continued growth in the jobrnmarket, as confirmed by Friday’srnemployment report from thernBLS. Despite the strong increase in thernpurchase market last week, volume continuesrnto run 16 percent behind last year’s pace.”</p

Contract interestrnrates dropped during the week, some to the lowest levels in many months, andrnall effective rates decreased from the previous week.  The average rate for 30-year fixed-rate mortgages (FRM) with conforming loan balances of $417,000 or less decreased to 4.43 percent, the lowest rates since November 2013, from 4.49 percent. rnPoints decreased to 0.21 from 0.38.</p

The average rate for jumbo 30-year FRM (balances over $417,000) droppedrnto 4.29rnpercent, the lowest rate since June 2013, from 4.37 percent. rnPoints were unchanged at 0.14.</p

The average contractrninterest rate for 30-yearrnfixed-rate mortgages backedrnby the FHA decreased to 4.13 percent from 4.17 percent.rnPoints decreased to -0.03 from 0.10.</p

The average contractrninterest rate for 15-year fixed-rate mortgagesrndecreased 1 basis point to 3.52 percent and points were down to 0.22 fromrn0.31.</p

The average contractrninterest rate for 5/1 ARMs decreased to 3.21 percentrnfrom 3.26 percent, with points decreasing to 0.29 from 0.35. The adjustable-rate mortgagern(ARM) share of activity increasedrnfrom 8 to 9 percent of total applications.</p

MBA’s data is derived from its Weekly Mortgage Applications Survey whichrnit has conducted since 1990.  The survey coversrnover 75 percentrnof all U.S. retail residential mortgagernapplications, and respondents include mortgage bankers,rncommercial banks and thrifts. Base period and value for all indexes is March 16, 1990=100rnand interest rates are quoted for loans with an 80 percent loan-to-value ratio.  Points include the origination fee.

All Content Copyright © 2003 – 2009 Brown House Media, Inc. All Rights Reserved.nReproduction in any form without permission of MortgageNewsDaily.com is prohibited.

About the Author

devteam

Steven A Feinberg (@CPAsteve) of Appletree Business Services LLC, is a PASBA member accountant located in Londonderry, New Hampshire.

See all blogs
Share

Comments

Leave a Comment

Leave a Reply

Latest Articles

Real Estate Investors Skip Paying Loans While Raising Billions

By John Gittelsohn August 24, 2020, 4:00 AM PDT Some of the largest real estate investors are walking away from Read More...

Late-Stage Delinquencies are Surging

Aug 21 2020, 11:59AM Like the report from Black Knight earlier today, the second quarter National Delinquency Survey from the Read More...

Published by the Federal Reserve Bank of San Francisco

It was recently published by the Federal Reserve Bank of San Francisco, which is about as official as you can Read More...