Mortgage Applications Drop for Second Week in a Row Down -1.8% in the Week Ending July 2nd, 2021

According to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Application Survey, for the week ending July 2nd , 2021, the Market Composite Index , a measure of mortgage loan application volume decreased -1.8% percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index decreased -2% compared with the previous week. The Refinance Index decreased -2% from the previous week and was -8% lower than the same week one year ago. The seasonally adjusted Purchase Index decreased -1% from one week earlier. The unadjusted Purchase Index decreased -1% compared with the previous week and was -14% lower than the same week one year ago. In a statement prepared for the release of this week’s application survey, Joel Kan, MBA’s Associate Vice President of Economic and Industry Forecasting said, “Mortgage application activity fell for the second week in a row, reaching the lowest level since the beginning of 2020. Even as mortgage rates declined, with the 30-year fixed rate dropping 5 basis points to 3.15 percent, both purchase and refinance applications decreased. Treasury yields have been volatile despite mostly positive economic news, including last week’s June jobs report, which showed ongoing improvements in the labor market. However, rates continued to move lower – especially late in the week. The 30-year fixed rate was 11 basis points lower than the same week a year ago, but many borrowers previously refinanced at even lower rates. Refinance applications have trended lower than 2020 levels for the past four months.” Kan added, “Swift home-price growth across much of the country, driven by insufficient housing supply, is weighing on the purchase market and is pushing average loan amounts higher.”