This morning the Mortgage Bankers Association released the Weekly Mortgage Applications Survey. According to the report:
“The Market Composite Index, a measure of mortgage loan application volume, increased 2.2 percent on a seasonally adjusted basis from one week earlier. On an unadjusted basis, the Index increased 47.5 percent compared with the previous week, which included the New Year’s holiday.
The Refinance Index increased 4.9 percent from the previous week. The seasonally adjusted Purchase Index decreased 3.7 percent from one week earlier. The unadjusted Purchase Index increased 41.9 percent compared with the previous week and was 10.5 percent lower than the same week one year ago”.
The four week moving average for purchases is down 1 percent, and the four week moving average for refinances is down 7.5 percent. Refinances still make up about 72 percent of all mortgage activity,up slightly from the week prior.
The dependence of the mortgage industry on refinancing must give some pause to those who work in this sector, especially since refinance activity dropped off sharply when Freddie Mac saw rates increase from 4.30 percent in November to as high as 4.86 percent in December. Rates have come back down somewhat over the past two weeks, which has caused activity to pick up somewhat.
There is little in this report to suggest that the housing market will pick up in the first part of 2011.
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