Weekly Mortgage Applications Fall 4.6 Percent
Despite a drop in mortgage rates, applications for Florida home loans declined last week for the first time in three weeks, according to the Mortgage Bankers Association’s seasonally adjusted index. U.S. mortgage application activity for the week ending July 14 decreased 4.6 percent, falling to a level of 540.8 from the previous week’s 566.8.
Borrowing costs for the average 30-year fixed-rate Florida home loan, excluding fees, averaged 6.73 percent, down 0.08 from the previous week. Both the state’s and the nation’s mortgage rates are now 0.13 percent below the four-year high they reached three weeks ago.
The MBA’s seasonally adjusted purchase mortgage index fell 6.2 percent to 398.5. The index is substantially below its year-ago level of 488.7, and has been considered a quality, timely gauge of U.S. home sales. The group’s index of refinancing applications decreased 1.6 percent to 1,377.6. A year earlier, the index stood at a much higher 2,618.2.
The refinancing share of applications increased to 35.0 percent from 34.0 percent the previous week, while fixed 15-year mortgage rates fell from an average of 6.40 a week ago to 6.38 percent this week. Rates on one-year adjustable-rate mortgages (ARMs) fell to 6.28 percent from 6.41 percent.
Overall ARM share of Florida home mortgage loan activity increased to 29.0 percent from 28.7 percent of the total applications filled out during the previous week. Historically low mortgage rates have fueled a five-year housing boom, helping support the U.S. economy’s recovery from recession despite plenty of business uncertainty.
The soft MBA data follows an industry survey showing the confidence of U.S. home builders hit a 14-year low in July as more buyers canceled contracts and investors pulled back from the housing market overall.
The National Association of Home Builders‘ index of member confidence fell 3 percent last month, the group said Tuesday. More insight into the status of the U.S. housing market should emerge on Wednesday as the Commerce Department releases its report on housing starts and permits. Respondents to the MBA survey include Florida mortgage bankers, commercial banks and thrifts, in addition to professionals in similar capacities from around the country.
