Mortgage Applications Fall 1.5% as Rates Climb Above 7%
Mortgage applications fell 1.5% as rates rose above 7%, the MBA reported. The refinance index dropped 62% year over year, while unadjusted purchase applications rose 9% for the week.
- Author
- By Grace Kim
- Filed
- Length
- 2 min read
Key takeaways
- Mortgage applications decreased 1.5% for the week ending September 18 as rates rose above 7%, per the MBA survey.
- The refinance index fell 3% week over week and was 62% lower than the same week one year ago.
- The unadjusted purchase index rose 9% from the previous week but was 11% lower year over year.
Mortgage applications decreased 1.5% from one week earlier as rates rose above 7%, according to data from the Mortgage Bankers Association (MBA)'s weekly mortgage applications survey for the week ending September 18.
The Washington, DC-based trade group confirmed that last week's results included an adjustment for the Labor Day holiday. On an unadjusted basis, the index increased 9% compared with the previous week.
The refinance index decreased 3% from the previous week. The decline runs far deeper on an annual basis: refinance activity was 62% lower than the same week one year ago.
The seasonally adjusted purchase index also saw a decrease, inching down 1% from one week earlier. The unadjusted purchase index, however, increased 9% compared with the previous week and was 11% lower than the same week one year ago.
The figures point to a market still constrained by borrowing costs above the 7% threshold. The 62% year-over-year collapse in refinancing shows how sharply homeowners have pulled back from replacing existing loans at current rates. Purchase activity tells a similar story on an annual basis, with the unadjusted purchase index down 11% from the same week in the prior year.
The MBA's weekly survey is one of the most closely watched barometers of housing demand, tracking application volume for both purchases and refinances across lenders nationwide. The Labor Day adjustment underscores the difficulty of reading single-week moves during holiday periods; the unadjusted 9% gain in the composite index and the 9% gain in unadjusted purchase applications suggest underlying activity did not fall as sharply as the seasonally adjusted figure implies.
For builders, developers, and housing-market analysts, the week's data adds to evidence that elevated rates continue to suppress transaction volume. With applications declining as rates hold above 7%, the survey's next releases will indicate whether purchase demand stabilizes or weakens further heading into the fall.
Source: FloorDaily
