Mortgage applications rose during the week ending Nov. 23 as rates declined following several weeks of market volatility, according to the Mortgage Bankers Association's (MBA) Weekly Mortgage Applications Survey.
The Market Composite Index, a measure of mortgage loan application volume, increased 5.5% on a seasonally adjusted basis and declined 29% on an unadjusted basis. The results include an adjustment for the Thanksgiving holiday.
The Refinance Index increased 1%. The Purchase Index increased 9% on a seasonally adjusted basis and decreased 28% on an unadjusted basis. The unadjusted Purchase Index was 2% higher than the same week one year ago.
Applications for refinances accounted for 37.9% of overall activity, down from 38.5% in the prior period. The adjustable-rate mortgage share of activity increased to 7.9% of total applications.
FHA applications took a 9.6% share, down from 10.7%. The VA share of total applications decreased to 9.9% from 10.6%, while the USDA share remained unchanged from 0.7%.
"After several weeks of market volatility, 30-year fixed mortgage rates decreased four basis points to 5.12% last week. Homebuyers responded, with purchase applications 1.7% higher than a year ago, and after adjusting for the Thanksgiving holiday, they increased almost 9% from the previous week," MBA Chief Economist Mike Fratantoni said. "The rise in purchase activity was led by conventional purchase applications, which surged almost 12%, while government purchases were essentially unchanged over the week. This also pushed the average loan size for purchase applications higher, which likely meant there were fewer first-time homebuyers in the market last week. Refinance activity increased slightly overall, driven by conventional refinances, while government refinances decreased, as both FHA and VA applications dropped over the past week."