| Actual | Previous | |
|---|---|---|
| Composite Index - W/W | 0.3% | 3.0% |
| Purchase Index - W/W | 4.7% | 3.9% |
| Refinance Index - W/W | -8.9% | 1.6% |
Highlights
The MBA mortgage applications index is 0.3 percent higher in the November 24 week. It is 8.8 percent higher than four weeks ago and 15.4 percent lower than a year earlier. MBA Deputy Chief Economist Joel Kan said,"Rates have declined more than 50 basis points over the past six weeks, which has helped to spur a small increase in purchase applications, but activity last week was still around 20 percent lower than a year ago. The purchase market remains depressed because of the ongoing, low supply of existing homes on the market. Similarly, refinance activity will likely be muted for some time, even with the recent decline in rates, as many borrowers locked in much lower rates in 2020 and 2021."
The purchase index is 4.7 percent higher in the current week and 15.7 percent higher than four weeks ago and 19.9 percent lower than a year earlier. The refinancing index is 8.9 percent lower and is 4.1 percent lower than four weeks ago and 0.7 percent higher than a year earlier. In the November 24 week, refinancing accounted for 30.6 percent of mortgage applications compared to 32.4 percent in the prior week.
The fixed-rate mortgage index is 0.5 percent higher in the November 24 week. It is 12.1 percent higher than four weeks ago and 14.5 percent lower than this week last year. The adjustable-rate mortgage index is 2.2 percent lower and is 17.8 percent lower than four weeks ago and 24.2 percent lower than a year ago. In the November 24 week, adjustable-rate mortgages accounted for 8.1 percent of mortgage applications compared to 8.3 percent in the prior week.
The contract rate for a 30-year fixed-rate mortgage is 7.37 percent in the current week. This is 4 basis points lower than the prior week, 49 basis points lower than four weeks ago, and 88 basis points higher than a year earlier. The contract rate for a 5-year adjustable-rate mortgage is 6.59 percent in the week. This is 17 basis points lower than the prior week, 18 basis points lower than four weeks ago, and 111 basis points higher than a year earlier.
The purchase index is 4.7 percent higher in the current week and 15.7 percent higher than four weeks ago and 19.9 percent lower than a year earlier. The refinancing index is 8.9 percent lower and is 4.1 percent lower than four weeks ago and 0.7 percent higher than a year earlier. In the November 24 week, refinancing accounted for 30.6 percent of mortgage applications compared to 32.4 percent in the prior week.
The fixed-rate mortgage index is 0.5 percent higher in the November 24 week. It is 12.1 percent higher than four weeks ago and 14.5 percent lower than this week last year. The adjustable-rate mortgage index is 2.2 percent lower and is 17.8 percent lower than four weeks ago and 24.2 percent lower than a year ago. In the November 24 week, adjustable-rate mortgages accounted for 8.1 percent of mortgage applications compared to 8.3 percent in the prior week.
The contract rate for a 30-year fixed-rate mortgage is 7.37 percent in the current week. This is 4 basis points lower than the prior week, 49 basis points lower than four weeks ago, and 88 basis points higher than a year earlier. The contract rate for a 5-year adjustable-rate mortgage is 6.59 percent in the week. This is 17 basis points lower than the prior week, 18 basis points lower than four weeks ago, and 111 basis points higher than a year earlier.
Definition
The Mortgage Bankers' Association compiles various mortgage loan indexes. The purchase applications index measures applications at mortgage lenders. This is a leading indicator for single-family home sales and housing construction.
Description
This provides a gauge of not only the demand for housing, but economic momentum. People have to be feeling pretty comfortable and confident in their own financial position to buy a house. Furthermore, this narrow piece of data has a powerful multiplier effect through the economy, and therefore across the markets and your investments. By tracking economic data such as the Mortgage Bankers Association purchase applications, investors can gain specific investment ideas as well as broad guidance for managing a portfolio.
Each time the construction of a new home begins, it translates to more construction jobs, and income which will be pumped back into the economy. Once a home is sold, it generates revenues for the home builder and the realtor. It brings a myriad of consumption opportunities for the buyer. Refrigerators, washers, dryers and furniture are just a few items new home buyers might purchase. The economic"ripple effect" can be substantial especially when you think a hundred thousand new households around the country are doing this every month.
Since the economic backdrop is the most pervasive influence on financial markets, housing construction has a direct bearing on stocks, bonds and commodities. In a more specific sense, trends in the MBA purchase applications index carry valuable clues for the stocks of home builders, mortgage lenders and home furnishings companies.
Each time the construction of a new home begins, it translates to more construction jobs, and income which will be pumped back into the economy. Once a home is sold, it generates revenues for the home builder and the realtor. It brings a myriad of consumption opportunities for the buyer. Refrigerators, washers, dryers and furniture are just a few items new home buyers might purchase. The economic"ripple effect" can be substantial especially when you think a hundred thousand new households around the country are doing this every month.
Since the economic backdrop is the most pervasive influence on financial markets, housing construction has a direct bearing on stocks, bonds and commodities. In a more specific sense, trends in the MBA purchase applications index carry valuable clues for the stocks of home builders, mortgage lenders and home furnishings companies.
