So far it is shaping up to be a lackluster spring home shopping season, as composite mortgage application volume fell 1.6% during the week ending April 4, compared to the week prior, according to the Mortgage Bankers Association's (MBA) Weekly Mortgage Applications Survey.
The last time composite mortgage application volume increased was the week ending Feb. 28, according to the survey.
Normally at this time of year, lenders would see increasing loan application volume as spring shoppers emerge from winter hibernation. The lack of activity so far this spring raises questions about comments made by industry analysts in February and March that harsh winter weather was partly to blame from the recent drop-off in applications.
On an unadjusted basis, application volume was down 1% compared with the previous week.
However, the seasonally adjusted Purchase Index, which measures incoming purchase volume, increased 3% from one week earlier – an indication that the downturn may soon reverse. On an unadjusted basis, the Purchase Index increased 3% compared with the previous week and was 14% lower compared to the same week one year ago.
Refinances continued to decline, dropping 5% from the previous week. The refinance share of mortgage activity decreased to 51% of total applications, down from 53% the previous week, to reach the lowest level since July 2009.
Surprisingly, application volume is down despite the fact that interest rates have been relatively stable during the past several weeks and remain historically low. The average rate for a 30-year fixed-rate mortgage (FRM) with conforming loan balance ($417,000 or less) was flat compared to the previous week at 4.56%.
The average rate for a 30-year FRM with jumbo loan balance (greater than $417,000) was 4.49%, up from the previous week, when it was 4.46%.
The average rate for a 30-year FRM backed by the Federal Housing Administration was 4.19%, down from 4.21% the week prior.
The average rate for a 15-year FRM remained unchanged at 3.62%.
The average rate for a 5/1 adjustable-rate mortgage (ARM) was 3.26%, up slightly from 3.25% the week prior. The ARM share of activity remained unchanged at 8% of total applications.