According to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Application Survey (WMAS), for the week ending March 18, 2022, the Market Composite Index (a measure of mortgage loan application volume) declined -8.1% on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decrease -8.0% compared with the previous week.
The Refinance Index decreased -14.0% from the previous week and was -54.0% lower than the same week one year ago.
The seasonally adjusted Purchase Index decreased -2.0% from one week earlier. The unadjusted Purchase Index decreased 1.0% compared with the previous week and was -12.0% lower than the same week one year ago.
In a statement prepared for this week’s WMAS, Mike Fratantoni, MBA’s Senior Vice President and Chief Economist said:
“Rates on 30-year conforming mortgages jumped by 23 basis points last week, the largest weekly increase since March 2020. The jump in rates comes as markets moved to price in a much faster pace of rate hikes, as well as expectations of fewer MBS purchases from the Federal Reserve. With mortgage rates now at 4.5 percent, compared to rates at or below 3 percent not that long ago, it is no surprise that refinance volume has dropped by more than 50 percent compared to this time last year. MBA’s new March forecast expects mortgage rates to continue to trend higher through the course of 2022.”
“Purchase application volume was down slightly for the week, with a larger drop in FHA and VA purchase volume, and a small decline in conventional purchase loans. First-time homebuyers, who rely on these government programs, are increasingly challenged by both the rapid increase in home prices and higher mortgage rates. Repeat homebuyers, who are more likely to use conventional loans, benefit from the gains in home equity realized on a sale which can be used to fuel their next purchase, even with rates moving higher.”
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