Eye On Housing
Since the start of 2021, the MBA’s tracked 30-year fixed rate mortgage rate has increased 40 basis points and currently stands at 3.28%. The week that showing the largest gains over the last month was the week ending February 26, increasing by 15 basis points. The previous week (i.e., the week ending February 19) saw an increase of 10 basis points.
Over the last month, the MBA’s Market Composite Index (seasonally adjusted) changed most in the week ending February 19, falling from 892.6 to 790.6, an 11.4% decline. The decline owed primarily to a drop in refinancing, which itself dropped approximately by the same percentage.
The Purchasing Index tapered down to weekly levels comparable to what existed in early 2020 (specifically, prior to March 2020). Per the MBA, signs of faster economic growth, an improving job market, and increased vaccine distribution are pushing rates higher.
On an unadjusted basis, the Purchasing Index and Refinancing Indexes showed significant declines for prior months’ year-over-year gains: the Purchasing Index dwindled to single-digit YoY percentage gains in the last three weeks of activity, while the Refinancing Index decreased by 43% and then by 39% respectively in the last two weeks.
Over the last month, the refinancing shares of total mortgage activity declined by several percentage points from one week to the next. As of the latest week’s activity, the refinance share decreased to 62.9 percent of total applications. Adjustable-rate mortgage activity shares over the last month were elevated relative to the months prior.
Anyone who can’t sell with rates well under 4% should seek another line of work