Mortgage Applications Down 6.2 Percent
For the week ending Aug. 23, the MBA’s Market Composite Index dropped 6.2 percent on a seasonally adjusted basis from one week earlier while the unadjusted index sank by seven percent. The seasonally adjusted Purchase Index was down four percent from one week earlier and the unadjusted index was six percent lower, although the latter was two percent higher than the same week one year ago. The Refinance Index, which fueled a growing degree of activity, dropped by eight percent from the previous week, although it was also 167 percent higher than the same week one year ago, and the refinance share of mortgage activity dipped to 62.4 percent of total applications from 62.7 percent the previous week.
Among the federal programs, the FHA share of total applications increased to 10.5 percent from 9.7 percent while the VA share of total applications decreased to 9.9 percent from 11.6 percent and the USDA share of total applications remained unchanged from 0.5 percent.
“U.S. Treasury yields were volatile over the course of the week, as the ongoing trade dispute between the U.S. and China continued to generate uncertainty among investors,” said Joel Kan, MBA’s associate vice president of economic and industry forecasting. “Rates increased for the first time since the week of July 12, but were still 80 basis points lower than the beginning of the year. With rates edging higher, refinances and purchase applications fell, at eight percent and six percent, respectively. Purchase applications were still up around two percent year-over-year, but the drop in rates this summer have not yet led to a significant boost in activity. Uncertainty over the near-term economic outlook and low supply continue to be the predominant headwinds for prospective homebuyers.”