| Actual | Previous | |
|---|---|---|
| Composite Index - W/W | 20.4% | -1.2% |
| Purchase Index - W/W | 9.1% | 0.2% |
| Refinance Index - W/W | 37.0% | -3.6% |
Highlights
The MBA mortgage applications index is 20.4 percent higher in the February 28 week. It is 7.7 percent higher than four weeks ago and 28.7 percent higher than a year earlier. The purchase index is 9.1 percent higher in the current week and 7.8 percent lower than four weeks ago and 2.4 percent higher than a year earlier. The refinancing index is 37.0 percent higher and is 34.2 percent higher than four weeks ago and 83.2 percent higher than a year earlier. In the February 28 week, refinancing accounted for 43.8 percent of mortgage applications compared to 38.9 percent in the prior week.
Applications for new mortgages reflect improved home affordability with the latest decline in rates. Refinancing activity jumps in the February 28 week, but is still at low levels. Current mortgage holders with fixed rate mortgages above 7 percent are seeking to lower monthly costs or those with adjustable rate mortgages at similar or higher rates will be anxious to lock in their monthly housing costs.
The fixed-rate mortgage index is 19.8 percent higher in the February 28 week. It is 7.7 percent higher than four weeks ago and 31.4 percent higher than this week last year. The adjustable-rate mortgage index is 30.5 percent higher and is 8.8 percent higher than four weeks ago and 3.1 percent lower than a year ago.
The contract rate for a 30-year fixed-rate mortgage is 6.73 percent in the current week. This is 15 basis points lower than the prior week, 24 basis points lower than four weeks ago, and 29 basis points lower than a year earlier. The rate is now the lowest since mid-December 2024. The contract rate for a 5-year adjustable-rate mortgage is 5.85 percent in the week. This is 20 basis points lower than the prior week, 22 basis points lower than four weeks ago, and 53 basis points lower than a year earlier. In the February 28 week, adjustable-rate mortgages accounted for 5.8 percent of mortgage applications compared to 5.4 percent in the prior week.
Applications for new mortgages reflect improved home affordability with the latest decline in rates. Refinancing activity jumps in the February 28 week, but is still at low levels. Current mortgage holders with fixed rate mortgages above 7 percent are seeking to lower monthly costs or those with adjustable rate mortgages at similar or higher rates will be anxious to lock in their monthly housing costs.
The fixed-rate mortgage index is 19.8 percent higher in the February 28 week. It is 7.7 percent higher than four weeks ago and 31.4 percent higher than this week last year. The adjustable-rate mortgage index is 30.5 percent higher and is 8.8 percent higher than four weeks ago and 3.1 percent lower than a year ago.
The contract rate for a 30-year fixed-rate mortgage is 6.73 percent in the current week. This is 15 basis points lower than the prior week, 24 basis points lower than four weeks ago, and 29 basis points lower than a year earlier. The rate is now the lowest since mid-December 2024. The contract rate for a 5-year adjustable-rate mortgage is 5.85 percent in the week. This is 20 basis points lower than the prior week, 22 basis points lower than four weeks ago, and 53 basis points lower than a year earlier. In the February 28 week, adjustable-rate mortgages accounted for 5.8 percent of mortgage applications compared to 5.4 percent in the prior week.
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.
