by Bill McBride on 5/26/2010 08:07:00 AM
Wednesday, May 26, 2010
The Market Composite Index, a measure of mortgage loan application volume, increased 11.3 percent on a seasonally adjusted basis from one week earlier ...Click on graph for larger image in new window.
The Refinance Index increased 17.0 percent from the previous week. This third consecutive increase marks the highest Refinance Index recorded in the survey since October 2009. The seasonally adjusted Purchase Index decreased 3.3 percent from one week earlier and is the lowest Purchase Index observed in the survey since April 1997.
“Refinance application volume jumped last week as continuing financial market turmoil related to the budget crises in Europe extended the opportunity for homeowners to lock in at historically low mortgage rates,” said Michael Fratantoni, MBA’s Vice President of Research and Economics. “In contrast, purchase applications fell further this week, following last week’s sharp decline, keeping the purchase index at 13-year lows.”
The average contract interest rate for 30-year fixed-rate mortgages decreased to 4.80 percent from 4.83 percent, with points remaining constant at 1.08 (including the origination fee) for 80 percent loan-to-value (LTV) ratio loans. This is the lowest 30-year fixed-rate recorded in the survey since the week ending November 27, 2009.
This graph shows the MBA Purchase Index and four week moving average since 1990.
There was a spike in purchase applications in April, followed by a decline to a 13 year low last week. As Fratantoni noted last week: "The data continue to suggest that the tax credit pulled sales into April at the expense of the remainder of the spring buying season."
Posted by Bill McBride on 5/26/2010 08:07:00 AM