Mortgage applications increased 2.0% from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending September 6, 2019. This week’s results include an adjustment for the Labor Day holiday.

The Market Composite Index, a measure of mortgage loan application volume, increased 2.0% on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased 9% compared with the previous week. The Refinance Index increased 0.4% from the previous week and was 169% higher than the same week one year ago. The seasonally adjusted Purchase Index increased 5% from one week earlier. The unadjusted Purchase Index decreased 8% compared with the previous week and was 9% higher than the same week one year ago.

“Mortgages rates continued to decline over the holiday-shortened week, with the 30-year fixed rate decreasing five basis points and remaining near three-year lows,” said Joel Kan, MBA’s Associate Vice President of Economic and Industry Forecasting. “Refinances were essentially unchanged, up just 0.4 percent, but August overall was the strongest month of activity so far in 2019. Purchase applications rose around 5 percent, with increases for both conventional and government applications.”

Added Kan, “Purchase activity was 9% higher than last year, continuing the trend of solid year-over-year gains.”

The refinance share of mortgage activity decreased to 60.0% of total applications from 60.4% the previous week. The adjustable-rate mortgage (ARM) share of activity decreased to 5.6% of total applications.

The FHA share of total applications decreased to 9.3% from 10.2% the week prior. The VA share of total applications increased to 11.9% from 11.3% the week prior. The USDA share of total applications decreased to 0.5% from 0.6% the week prior.

The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($484,350 or less) decreased to 3.82% from 3.87%, with points increasing to 0.44 from 0.34 (including the origination fee) for 80% loan-to-value ratio (LTV) loans. The effective rate decreased from last week.

The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $484,350) decreased to 3.84% from 3.94%, with points increasing to 0.34 from 0.24 (including the origination fee) for 80% LTV loans. The effective rate decreased from last week.

The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA decreased to 3.76% from 3.80%, with points decreasing to 0.31 from 0.32 (including the origination fee) for 80% LTV loans. The effective rate decreased from last week.

The average contract interest rate for 15-year fixed-rate mortgages decreased to 3.28% from 3.29%, with points increasing to 0.47 from 0.32 (including the origination fee) for 80% LTV loans. The effective rate increased from last week.

The average contract interest rate for 5/1 ARMs increased to 3.42% from 3.40%, with points increasing to 0.48 from 0.27 (including the origination fee) for 80% LTV loans. The effective rate increased from last week.