Since its previous week’s reading, which also marked a record low in the series, the Mortgage Bankers Association’s 30-year fixed-rate mortgage contract rate edged up by 3 basis points to 3.43%. The Market Composite Index, measuring mortgage loan application volume for purchases and refinancings, increased by 0.3% on a seasonally adjusted basis from one week prior.
The MBA cites the release of pent-up housing demand from relaxed stay-at-home orders as the reason for the continued increase in Purchasing activity, indicated by the seasonally-adjusted increase of 11% in the Purchasing index from the prior week. In the absence of the virus-related lockdown measures, the market activity from spring homebuying season would clearly be greater, with increased traffic of prospective homeowners. The unadjusted Purchase index is reflective of this, being 10% lower than the same week one year ago.
In contrast to purchase activity, refinancing activity was more subdued from the previous week. Not only did its seasonally adjusted index decrease 3% from the previous week, but also the number of refinance applications decreased for a fourth consecutive week. The refinance share of mortgage activity decreased to 67.0% of total applications from 70.0% the previous week.