Purchase mortgage activity is heating up while refinance activity continues cooling down.
Mortgage Loan Application Volume Rebounded +0.3%
For the week ending September 8, the volume of mortgage loan applications picked up +0.3%, according to the Mortgage Bankers Association.
Most of the mortgage activity on the plus side came from purchase mortgage activity. Purchase mortgage activity posted an increase of +8% the week ending September 8 compared with the week prior. Meanwhile, it’s no surprise that the MBA’s refinance index continued to slip, down -3%, from the previous week.
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Purchase Mortgage Application Volume at Highest Level Since August
Joel Kan, associate vice president of economic and industry forecasting with the MBA, noted that this current level of purchase mortgage application volume registered its highest level since April 2021.
Kan said, “Compared to the same week last September, which was right in the middle of a significant upswing in home purchases, applications were down -11%, the smallest year-over-year decline in 14 weeks.”
Average Purchase Loan Size Increases
The average loan size for a purchase application grew along with the increased volume of purchase applications during the week ending September 8. The average loan size for a purchase application rose to $396,800. Thank rising home prices for rising loan sizes.
Kan added, “The very competitive purchase market continues to put upward pressure on sales prices.”
Refinancings Taking Smaller Slice of Mortgage Pie
The refinance share of mortgage activity during the week ending September 8 decreased from 66.8% to 64.9% of total applications.
“Refinance applications slipped to their slowest pace since early July, and the refinance share of applications fell to 65%, which was also the lowest since July,” said Kan.
Share of FHA, VA and USDA Mortgage Applications Also Slipped
The MBA reported that GSE-backed loan applications decreased as well as conventional applications. Take a look:
- FHA share – from 10.9% to 9.9%
- VA share – from 10.4% to 10.2%
- USDA share – from -.5% to 0.4%
Thanks to Mortgage Bankers Association and HousingWire.