by Calculated Risk on 2/03/2021 07:00:00 AM

From the MBA: Mortgage Applications Increase in Latest MBA Weekly Survey

Mortgage applications increased 8.1 percent from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending January 29, 2021.

... The Refinance Index increased 11 percent from the previous week and was 59 percent higher than the same week one year ago. The seasonally adjusted Purchase Index increased 0.1 percent from one week earlier. The unadjusted Purchase Index increased 8 percent compared with the previous week and was 16 percent higher than the same week one year ago.

“After increasing for three consecutive weeks, the 30-year fixed mortgage rate dropped 3 basis points to 2.92 percent. The one-week reversal in the recent upswing in rates drove an increase in both conventional and government refinance activity, as borrowers continue to lock in these historically low rates. MBA’s refinance index hit its highest level since March 2020 and jumped 60 percent year-overyear,” said Joel Kan, MBA’s Associate Vice President of Economic and Industry Forecasting. “Purchase activity was unchanged last week, with a 1 percent increase in conventional applications offset by a 3 percent decline in government applications. Average purchase loan amounts in early 2021 continue to rise across all loan types, driven by a strong pace of home sales, tight housing inventory and high homeprice growth. Conventional, FHA and VA purchase loan sizes all set new survey records last week.”
...
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($510,400 or less) decreased to 2.92 percent from 2.95 percent, with points remaining unchanged at 0.32 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans.
emphasis added

Click on graph for larger image.


The first graph shows the refinance index since 1990.

The refinance index has been volatile recently depending on rates.

With near record low rates, the index remains up significantly from last year.

The second graph shows the MBA mortgage purchase index

According to the MBA, purchase activity is up 16% year-over-year unadjusted.

Note: Red is a four-week average (blue is weekly).