Mortgage applications jumped 3.2 percent last week, reversing a recent downward trend, according to a report released today by the MBA. The trade association's market composite index of overall application volume grew to 626.1 for the week ending February 23, up from 606.6 one week earlier. While overall application activity was driven by a 5.2 percent increase in purchase volume, refinancing activity also jumped, increasing 1.2 percent to 1943.5 from 1921.1 the previous week. The MBA also said refinance share of mortgage activity decreased to 43.2 percent of total applications from 44.9 percent the previous week, while the adjustable-rate mortgage (ARM) share of activity decreased to 21.1 from 21.2 percent of total applications from the previous week.
The news of a jump in application volume coincided with steady uncertainty surrounding housing markets and renewed investor concerns on Wall Street. As fresh news that the housing market may not have yet hit bottom yet was reported yesterday, with the NAR reporting decreases in both sales volume and sales prices on a year-to-year basis, stock market jitters dropped Treasury yields to a two month low. That means the drop in refinancing share may be short lived, sources tell Housing Wire. The drop in Treasure yields will likely drive down mortgage rates in the days and weeks ahead, fueling a resurgence in application volume, particulary in refinancing activity. The MBA also reported a big jump in government loan applications, with the government index jumping 17 percent 121.3 from 103.7 the previous week. The four week moving average for the seasonally-adjusted composite application index remains down 0.2 percent to 625.6 from 626.9, reflecting the downward trend in applications over the past few weeks. For more information, visit http://www.mortgagebankers.org.
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