Mortgage applications decreased 6.0 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending October 7, 2016.
… The Refinance Index decreased 8 percent from the previous week, to its lowest level since June 2016. The seasonally adjusted Purchase Index decreased 3 percent from one week earlier. The unadjusted Purchase Index decreased 2 percent compared with the previous week and was 27 percent higher than the same week one year ago.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,000 or less) increased to its highest level since September 2016, 3.68 percent, from 3.62 percent, with points increasing to 0.35 from 0.32 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans.
The first graph shows the refinance index since 1990.
Refinance activity has increased this year since rates have declined. Since rates are up a little recently, refinance activity has declined a little.
The purchase index was “27 percent higher than the same week one year ago”. Don’t read too much into the year-over-year increase – remember last year there was a sharp increase in applications the week prior to the TILA-RESPA regulatory change, and the following week applications plunged 28%. Since this is a comparison to the week following the regulatory change, applications are up year-over-year. This will smooth out soon.