Purchase loan activity has dropped in five of the last six weeks as some buyers remain wary, according to the Mortgage Bankers Association.

Purchase loan activity mostly held steady last week, dipping slightly as mortgage rates ticked upward by a few basis points. 

The Mortgage Bankers Association’s measure of mortgage-loan-application volume declined by 0.3 percent on an unadjusted basis during the week ending Aug. 5. After applying seasonal adjustments, it represented an increase of 0.2 percent.

Refinancing activity was up 4 percent over the previous week, while unadjusted purchase activity dropped by 2 percent.

 “The purchase market continues to experience a slowdown, despite the strong job market,” said Joel Kan, MBA’s associate vice president of economic and industry forecasting. “Activity has now fallen in five of the last six weeks, as buyers remain on the sidelines due to still-challenging affordability conditions and doubts about the strength of the economy.”

When looking back across the last 12 months, it becomes clear just how far the mortgage industry has fallen from its 2021 heights — a fact that has had broad implications for the companies in this space as well as home demand generally.

Refinancing was down 82 percent compared to the same week in 2021. Meanwhile, purchase loans were down 19 percent year over year.

The MBA’s survey goes out each week to mortgage bankers, commercial banks and thrifts, and covers more than 3 in 4 of all U.S. retail residential mortgage applications, according to the report.

During the week ending Aug. 5, the MBA reported average rates for the following types of loans:

  • For 30-year fixed-rate conforming mortgages, rates averaged 5.47 percent, up from 5.43 percent the week before. For loans with 20 percent down, points increased to 0.80 from 0.65.
  • Rates for 30-year fixed-rate jumbo mortgages — where loan balances were higher than $647,200 — averaged 5.09 percent, up from 5.06 percent the week before. With points rising to 0.59 from 0.36 for loans with 20 percent down.
  • For 30-year fixed-rate FHA mortgages, rates averaged 5.35 percent, down from 5.39 percent the week before. Points dipped slightly to 1.02 from 1.03 for homes with 20 percent down.
  • Rates for 15-year fixed-rate mortgages popular with homeowners who are refinancing remained unchanged at  4.74 percent. With points decreasing to 0.62 from 0.65 on loans with 20 percent down, the effective rate decreased.
  • For 5/1 adjustable-rate mortgages (ARMs), rates averaged 4.60, up from 4.55 percent the week before. Although points declined to 0.63 from 0.69 for loans with 20 percent down, the effective rate declined.

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Email Daniel Houston

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