Mortgage applications increased for the first time in five weeks as key interest rates held steady, according to the Mortgage Bankers Association.
The MBA’s Weekly Mortgage Applications Survey for the week ending Feb. 15 found total volume increased 3.6% from the prior week’s revised results. The seasonally adjusted purchase index increased by 2% from the previous week, while the unadjusted purchase index increased by 7% compared to the previous week and was 3% higher than the same week one year ago.
“Mortgage rates held steady on mixed economic news, as core inflation remained firm, while retail sales in December were much weaker than expected,” Joel Kan, the MBA’s associate vice president of industry surveys and forecasts, said in a press release. “However, overall application activity picked up over the week. After four consecutive declines, purchase applications increased almost 2% over the week and 2.5% compared to a year ago — showing some promise as we edge closer to the spring home buying season.”
The refinance share of mortgage activity decreased to 41.7% of total applications from 41.8% the previous week.
Most rates remained close to 10-month lows, which allowed some borrowers with an incentive to refinance to capitalize, Kan added.
Adjustable-rate loan activity remained unchanged at 7.7% of total applications, while the share of Federal Housing Administration-guaranteed loans decreased to 10.2% from 11% the week prior.
The share of applications for Veterans Affairs-guaranteed loans decreased to 10.1% from 10.9% and the U.S. Department of Agriculture/Rural Development share increased to 0.7% 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) increased 1 basis point to 4.66%. For 30-year fixed-rate mortgages with jumbo loan balances (greater than $484,350), the average contract rate increased 8 basis points to 4.56%.
The average contract interest rate for 30-year fixed-rate mortgages backed by the FHA increased 7 basis points to 4.68%. For 15-year fixed-rate mortgages, the average remained unchanged at 4.04%. The average contract interest rate for 5/1 adjustable-rate mortgages increased 3 basis points to 4%.