Mortgage Applications Slip to Four-Year Lows
Prospective home buyers, we have another sign of relief for you.
Prospective sellers, we have another reason for you to bite your nails.
The Mortgage Bankers Association announced yesterday that applications for new Florida home loans — both refinancing and traditional purchase loans combined — hit their lowest level since May 2002. Refinance applications fell to their lowest level since November 2003. The Florida mortgage market, along with the national landscape, is cooling off.
The Market Composite Index, the Mortgage Bankers Association’s measure of loan application volume, hit 527.6, a decrease of 1.2 percent from a week earlier. This is the lowest that the index has been since May 2002.
On an unadjusted basis, the Index decreased 1.4 percent compared with the previous week, but was down 29.0 percent compared with the same week one year earlier. The seasonally-adjusted Purchase Index shows applications falling by 3.3 percent from the previous week and the Refinance Index increased by 2.3 percent to 1417.2, up from 1385.2 one week earlier.
The Purchase Index is at its lowest since November 2003. Other seasonally adjusted index activity includes the Conventional Index, which decreased 1.3 percent to 777.5 from 788.0 the previous week, and the Government Index, which increased 0.9 percent to 110.9 from 109.9 the previous week.
The four-week moving average for the seasonally-adjusted Market Index is down 1.5 percent to 542.3 from 550.6. The four-week moving average is down 2.3 percent to 397.2 from 406.7 for the Purchase Index, while this average is down 0.1 percent to 1395.1 from 1396.8 for the Refinance Index.
The refinance share of Florida home loan activity increased to 37.0 percent of total applications, up from 35.6 percent the previous week. Meanwhile, adjustable-rate mortgages (ARMs) comprised a 27.8 percent share of activity compared with 28.6 percent the previous week. The ARM share is at its lowest since March 2004.
Overall, Florida mortgage rates are expected to slide again this week as investors’ fears regarding the Federal Reserve’s inflation-fighing efforts have calmed somewhat. As mortgage applications decline, the one-strong market softens further, finally allowing new buyers some breathing room. Take advantage of the opportunities a slower real estate market offers!
