After dropping 3.3% the previous week, mortgage application volume increased 0.9% during the week ended Dec. 19, on an adjusted basis, according to the Mortgage Bankers Association's (MBA) Weekly Mortgage Applications Survey.
On an unadjusted basis, volume was up 0.4%.
Applications for refinances were up 1%, as rates hit new lows for the year. Applications for purchases also increased 1% from one week earlier.
On an unadjusted basis, purchase application volume decreased 1% compared with the previous week and was 1% lower than the same week one year ago.
The refinance share of mortgage activity increased to 67% of total applications from 66% the week prior.
The average rate for a 30-year fixed-rate mortgage (FRM) with conforming loan balance ($417,000 or less) was 4.02%, down from 4.06% to reach the lowest level since May 2013.
The average rate for a 30-year FRM with jumbo loan balance (greater than $417,000) was 4.07%, up from 3.99% the week prior.
The average rate for a 30-year FRM backed by the Federal Housing Administration (FHA) was 3.81%, down from 3.86%.
The average rate for a 15-year FRM was 3.29%, down from 3.33%.
The average rate for a 5/1 adjustable-rate mortgage (ARM) was 3.10%, up from 3.00%.
The ARM share of activity increased to 6.5% 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 8.6% of all applications, down from 8.7% the previous week. Applications for Veterans Affairs mortgages represented 10.3% of all loans, down from 10.6% the previous week. Applications for mortgages through the U.S. Department of Agriculture remained unchanged at 0.8% of total applications.