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Mortgage applications increased 21.7 percent nationwide from one week earlier in the wake of the Federal Reserve’s rate cut, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending Aug. 9.
The MBA’s Market Composite Index, a measure of mortgage loan application volume, increased 21.7 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the index increased 20 percent compared with the previous week. The Refinance Index increased 37 percent from the previous week to its highest level since July 2016, and was 196 percent higher than the same week one year ago. The seasonally adjusted Purchase Index increased 2 percent from one week earlier. The unadjusted Purchase Index increased 1 percent compared with the previous week and was 12 percent higher than the same week one year ago.
“The 2019 refinance wave continued, as homeowners last week responded to extraordinarily low mortgage rates. Fears of an escalating trade war, combined with economic and geopolitical concerns, once again pulled U.S. Treasury rates lower. The 30-year fixed mortgage rate decreased eight basis points to 3.93 percent – the lowest level since November 2016 – and has now dropped more than 80 basis points this year,” MBA Associate Vice President of Economic and Industry Forecasting Joel Kan said in a statement. “In just the last two weeks, rates have decreased 15 basis points.”
The refinance share of mortgage activity increased to 61.4 percent of total applications from 53.9 percent the previous week. The adjustable-rate mortgage (ARM) share of activity increased to 6 percent of total applications.
The FHA share of total applications decreased to 9.5 percent from 11 percent the week prior. The VA share of total applications decreased to 12.2 percent from 12.8 percent the week prior. The USDA share of total applications decreased to 0.5 percent from 0.6 percent the week prior.
