Mortgage applications dropped 3.1% in the week leading up to Thanksgiving, according to adjusted rates from the MBA’s weekly application survey. The Purchase Index increased 2%, but activity fell for refinancing and adjustable-mortgage rates.
- Mortgage Applications dropped 3.1% on the week ending November 24th
- Purchase Index rose 2%
- Refinance and ARM activity fell
- Interest rates for 30-year fixed-rate mortgages held steady at 4.20%
The latest weekly shift of mortgage activity accurately reflects many forecasted trends for the real estate market in 2018. Applications dropped 3.1% on an adjusted basis for the Thanksgiving holiday. On an unadjusted basis, applications saw a 34% decrease.
The Purchase index rose 2%, reaching its highest level since September. That growth is a good sign that demand remains strong enough to keep builder confidence up at their recent highs.
Adjustable-rate mortgage share of activity fell to 6.2% of total applications on the week. Refinance share of mortgage activity also decreased to 48.7%, down from 49.9% a week earlier, which can be expected alongside rising mortgage rates.
And although average interest rates for 30-year fixed-rate mortgages with conforming loan balances (under $424,100) remained stagnant at 4.20%, top MBA economists forecast that rates will rise above 5% by the end of next year. Rates for 30-year FRMs with jumbo loan balances ($424,100 or more) fell to 4.14%, down from 4.16% the week before.