Mortgage Bankers Association

A week after it dropped to a 28-year low, purchase activity decreased again by over 5%, according to the Mortgage Bankers Association.

Volumes fell 18% compared to the previous week, while refinance activity also pulled back.

Higher interest rates helped drive down refinances by 87% and purchases by 42% compared to last year.

The decline in loan activity and softening prices also helped drive down builder sentiment for the 11th month in a row.

Ongoing weakness in housing markets and the economy has now driven purchase activity to its lowest level since 2015, while overall application numbers decreased for the 10th time in 11 weeks.

Activity is coming in at or below 2020 levels according to reports from the Mortgage Bankers Association and Redfin.

Refinances inched up 2% as interest rates dipped, but accounted for only 31% of activity, compared to two-thirds a year ago.

New single-family home mortgage applications, housing starts and industry sentiment all came in at their lowest since 2020.

Average purchase-loan amounts shrank for the second week in a row and are currently 12% below their record size in March.

Elevated prices coupled with higher mortgage rates are leading to affordability challenges that have reduced borrowing volumes.