Mortgage application volume fell 9.1%, on an adjusted basis, during the two weeks ended Jan. 2, according to the Mortgage Bankers Association's (MBA) Weekly Mortgage Applications Survey. The drop was primarily due to the holidays, when home shopping activity typically falls to yearly lows.
On an unadjusted basis, volume was down 37%.
Applications for refinances fell 12%, on an adjusted basis, from two weeks earlier, while applications for purchases fell 5%.
On an unadjusted basis, applications for purchases were down 33% and were 8% lower compared to the same two-week period one year ago.
Looking at the single week ended Jan. 2, the refinance share of mortgage activity increased to 65% of total applications from 63% the previous week.
Rates fell slightly during the week ended Jan. 2, compared to the previous week, according to the MBA's data. The average rate for a 30-year fixed-rate mortgage (FRM) with conforming loan balance ($417,000 or less) was 4.01%, down from 4.04%.
The average rate for a 30-year FRM with jumbo loan balance (greater than $417,000) was 3.99%, down from 4.05% the week prior.
The average rate for a 30-year FRM backed by the Federal Housing Administration (FHA) was 3.81%, down from 3.82% the previous week.
The average rate for a 15-year FRM was 3.24%, down from 3.32%.
The average rate for a 5/1 adjustable-rate mortgage (ARM) was 3.19%, down from 3.26%.
The ARM share of activity decreased to 4.9% of total applications.
All rates are based on closings. The survey covers over 75% of all U.S. retail residential mortgage applications.
Looking at application volume by loan type, applications for mortgages backed by the FHA represented 9.3% of all applications, up from 9.2%% the previous week. Applications for Veterans Affairs mortgages represented 10.7% of all loans, up from 10.5% the previous week. Applications for mortgages through the U.S. Department of Agriculture remained unchanged at 0.9% of total applications.