by Bill McBride on 1/07/2015 07:01:00 AM
Wednesday, January 07, 2015
Mortgage applications decreased 9.1 percent from two weeks earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending January 2, 2015. The most recent week’s results include an adjustment to account for the New Year’s Day holiday, while the previous week’s results were adjusted for the Christmas holiday....Click on graph for larger image.
The Refinance Index decreased 12 percent from two weeks ago. The seasonally adjusted Purchase Index decreased 5 percent from two weeks earlier ... The Purchase Index was 8 percent lower 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) decreased to 4.01 percent from 4.04 percent, with points decreasing to 0.28 from 0.35 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans.
The first graph shows the refinance index.
The refinance index is down 75% from the levels in May 2013.
2014 was probably the lowest year for refinance activity since year 2000 (haven't seen final stats yet). Even with the sharp decline in rates this week, mortgage rates would have to decline further for there to be a large refinance boom - so I expect refinance activity to be low again in 2015.
The second graph shows the MBA mortgage purchase index.
According to the MBA, the unadjusted purchase index is down 8% from a year ago.
Posted by Bill McBride on 1/07/2015 07:01:00 AM