by Calculated Risk on 9/13/2006 12:19:00 AM

The Mortgage Bankers Association (MBA) reports: Home Purchase Applications Rise during Holiday-shortened Week

Caution: there was a similar bump last year in the MBA index during the week of the Labor Day holiday.

Click on graph for larger image.

The Market Composite Index, a measure of mortgage loan application volume, was 584.2, an increase of 3.2 percent on a seasonally adjusted basis from 566.3 one week earlier. On an unadjusted basis, the Index decreased 8.3 percent compared with the previous week and was down 22.8 percent compared with the same week one year earlier.

The seasonally-adjusted Purchase Index increased by 5.3 percent to 410.2 from 389.7 the previous week and the Refinance Index increased by 0.1 percent to 1597 from 1594.7 one week earlier.

Mortgage rates increased slightly:

The average contract interest rate for 30-year fixed-rate mortgages increased to 6.32 percent from 6.31 percent ...

The average contract interest rate for one-year ARMs increased to 5.96 percent from 5.91 percent ...

Update: I missed the Dow Jones data this week.

Purchase activity is off 22.8% from the comparable week last year.

This graph shows the Purchase Index and the 4 and 12 week moving averages.
Note: Scale does not start at zero to better show changes.

Average year-to-date purchase activity is 13.4% below 2005, and has been running more than 20% below 2005 for the last couple of months.