Global economic headwinds continued to drive mortgage applications lower for the week ending May 24, 2019, according to the Mortgage Bankers Association.
According to MBA’s weekly Mortgage Applications Survey, on an unadjusted basis, the Market Composite Index fell 3.3% from the previous week.
“Concerns over European economic growth and ongoing uncertainty about a trade war with China were some of the main factors that kept mortgage rates low last week,” MBA Vice President of Economic and Industry Forecasting Joel Kan said. “Even with lower rates on three of the five surveyed loan types, refinance activity fell 6%, essentially reversing an 8% increase the week before.”
“Purchase applications decreased for the third straight week, but remained more than 7% higher than a year ago,” Kan continued. “It is possible that the trade dispute is causing potential homeowners to hold off on buying, with the fear that further escalation – or the lack of resolution – may have adverse impacts on the economy and housing market.”
The Refinance Index dropped 6% from the previous week and the unadjusted Purchase Index slid 3% from a week ago but remained 7% higher than the same week in 2018. Lastly, the seasonally adjusted Purchase Index fell 1% from the week before.
Here’s a more detailed breakdown of this week’s mortgage application data:
- The refinance share of mortgage activity declined to 39.7% from last week’s 40.5%.
- The adjustable-rate mortgage share of activity fell to 6.6% of total applications.
- The Federal Housing Administration‘s share of mortgage apps slightly increased from last week’s 9.4% to 9.6%.
- The Veterans Affairs‘ share of applications moved forward to 11.2% from last week’s 11%.
- The Department of Agriculture‘s share of total applications edged up from last week’s 0.6% from 0.7%.
- Mortgage interest rates for 30-year fixed-rate mortgages with conforming loan balances ($484,350 or less) held steady from last week’s rate of 4.43 %.
- The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $484,350) decreased from last week’s 4.24% to 4.18%.
- The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA slid from last week’s 4.34 to 4.33%.
- The average contract interest rate for 15-year fixed-rate mortgages also retreated to 3.73% from 3.78% the week prior.
- The average contract interest rate for 5/1 ARMs rose to 3.74% from last week’s 3.57%.