Applications for home purchases saw more declines of late, falling for the third-straight week amid tariff and trade uncertainty and mortgage rates holding steady at an elevated 30-year average.
According to the latest Weekly Mortgage Applications Survey from the Mortgage Bankers Association (MBA) for the week ending April 25, the Market Composite Index (a measure of mortgage loan application volume) decreased 4.2% from the previous week’s 12.7% decrease. On an unadjusted basis, the Index decreased 4% compared with the previous week.
“Mortgage rates were little changed last week with the 30-year fixed rate at 6.89%. Mortgage application activity, particularly for home purchases, continues to be subdued by broader economic uncertainty and signs of labor market weakness, dropping to the slowest pace since February,” said Joel Kan, MBA’s vice president and deputy chief economist. “Even with the spring homebuying season underway, purchase applications decreased, as conventional and VA applications saw declines of 6% and 4%, respectively. With slowly-increasing housing inventory in many markets and first-time homebuyers still in the mix, FHA purchase applications fared better with only a slight decline. Overall purchase applications continue to run ahead of last year’s pace.”
MBA also reported that the Refinance Index decreased 4% from the previous week and was 42% higher than the same week one year ago. The seasonally adjusted Purchase Index decreased 4% from one week earlier. The unadjusted Purchase Index decreased 3% compared with the previous week and was 3% higher than the same week one year ago.
The refinance share of mortgage activity remained unchanged at 37.3% of total applications from the previous week. The adjustable-rate mortgage (ARM) share of activity decreased to 7.4% of total applications.
Added Kan, “Refinance activity dipped again, as mortgage rates remained close to 7%, and borrowers hold out for a bigger decline in rates. Given the pullback in refinancing, the average loan size for refinances declined to just under $290,000, the lowest level in three months.”
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