Mortgage applications rose by 2.0% on a seasonally-adjusted basis from one week earlier for the week ending November 30th, 2018, according to the Mortgage Bankers Association’s Weekly Mortgage Applications Survey. (The results for the week ending November 23rd, 2018 included an adjustment for the Thanksgiving holiday.)
On an unadjusted basis, the Market Composite Index, a measure of mortgage loan application volume, rose 42% compared to the previous week. The Refinance Index rose by 6% from the previous week. The seasonally-adjusted Purchase Index rose 1% over the same period, and the unadjusted Purchase Index rose 36%.
The refinance share of mortgage activity rose to 40.4% of total applications, up from 37.9% the previous week. The adjustable-rate mortgage (ARM) share of activity fell to 7.4% of applications. The FHA share rose to 10.2% from 9.6%, the VA share rose to 10.0% from 9.9%, and the USDA share fell to 0.6% from 0.7%.
“Application activity increased over the week for both purchase and refinance loans, and were 10 percent and 7 percent higher, respectively, than the week before the Thanksgiving holiday,” says Joel Kan, MBA’s Associate Vice President of Economic and Industry Forecasting. “Treasury rates continued to slide last week, driven mainly by concerns over slowing global economic growth and U.S. and China trade uncertainty. The 30-year fixed-rate fell for the third week in a row to 5.08 percent and has declined a total of nine basis points over this span.”
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($453,100 or less) fell to 5.08% from 5.12% the previous week. Points for 80% loan to value ratio (LTV) loans fell to 0.44 from 0.46. (All 80% LTV loan reports include the origination fee.) The effective rate decreased from last week.
The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $453,100) rose to 4.89% from 4.88%. Points for 80% LTV loans fell to 0.30 from 0.31, and the effective rate remained unchanged.
The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA fell to 5.05% from 5.11%. Points for 80% LTV loans fell to 0.62 from 0.63, and the effective rate decreased from last week.
The average contract interest rate for 15-year fixed-rate mortgages fell to 4.50% from 4.53% the previous week. Points for 80% LTV loans rose to 0.60 from 0.51, and the effective rate remained unchanged.
The average contract interest rate for 5/1 ARMs rose to 4.33% from 4.29%. Points for 80% LTV loans fell to 0.21 from 0.42, and the effective rate decreased from last week.
“We saw a decrease in the average loan size for purchase applications to the lowest since December 2017 ($298,000 from $313,000),” Kan says. “This is perhaps an indication that there are fewer jumbo borrowers, or maybe first-time buyers are having better success reaching the market as we close out the year.”
