Mortgage Applications Drop -2.4% in the Week Ending August 27, 2021

According to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Application Survey (WMAS), for the week ending August 27, 2021, the Market Composite Index, a measure of mortgage loan application volume, decreased -2.4% on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased -3% compared with the previous week. The Refinance Index decreased -4% from the previous week but was 2% higher than the same week one year ago. The seasonally adjusted Purchase Index increased 1 percent from one week earlier. The unadjusted Purchase Index decreased -2% compared with the previous week and was 16 percent lower than the same week one year ago.

In a statement prepared for the release of this week’s WMAS, Joel Kan, MBA’s Associate Vice President of Economic and Industry Forecasting said, “There was little change in mortgage rates last week, with the 30-year fixed remaining at 3.03 percent. Despite low rates, refinance applications declined, with some borrowers still waiting for rates to drop even lower. Recent uncertainty around the economy and pandemic have kept rates low over the past month, which is why the refinance index has oscillated around these levels.”

Kan added, “Even with a slight increase, purchase activity hit its highest level since early July, as applications for conventional and government loans increased. Home purchase activity continues to be dominated by higher price tiers of the market, with the purchase average loan size now at $396,500, the highest average in five weeks. According to FHFA, June’s year-over-year increase in home prices was 18.8 percent, while the second quarter saw a 17.4 percent increase overall. Both measures set new records, as housing demand continued to outpace the inventory of homes for sale.”