Mortgage application activity picked up a modest 4.9% in the week ending Oct. 21 as conforming and Federal Housing Administration (FHA) mortgage rates held steady.
According to the Mortgage Bankers Association (MBA), the Refinance Index increased 4.4% to ~3546, but remains well off from its 2011 high of 4867 hit in mid-August. To produce fresh highs on the index, primary rates need to drop to the 3.80% area, MBS analysts said. As a percent of total application activity, refinancing share slipped to 77.3% from 77.6%.
The Purchase Index rose 6.4% to ~172. The MBA also reported that for the month of September, the investor share of applications for home purchase increased slightly to 6.0% from 5.7% in August with the Mountain states showing the largest increase.
The average contract interest rate for 30-year fixed rate conforming loans held steady at 4.33%; Jumbo loan rates rose four basis points to 4.68%, while FHA rates slipped one basis point to 4.11%.
So far in October, the Refinance Index is averaging 7% lower than in September as mortgage rates are little changed on average at a 4.06% average.
At this time, speeds in November — when this activity will show its impact — are projected to increase less than 5% on average. This follows a modest projected increase of less than 5% on average for conventionals for October.