Mortgage applications in the United States saw an increase for the fourth consecutive week as interest rates fell to their lowest level in over a month, as reported by the Mortgage Bankers Association on Wednesday. The market composite index, which gauges loan application volume, rose by 2.8% for the week ending November 29, following seasonal adjustments.
This latest data includes a calculation based on the Thanksgiving holiday; without these adjustments, the index actually decreased by 30% compared to the previous week. The adjusted purchase index reached a notable 6%, marking an increase for four weeks in a row and reaching its highest point since January.
In contrast, without adjustments, the purchase index fell 30% week-over-week and 21% year-over-year. "The recent strength in purchase activity continues, supported by lower rates and higher inventory levels, which are giving prospective buyers more options compared to earlier in the year," stated Joel Kan, Deputy Chief Economist at the MBA. The refinance index experienced a slight decline of 1% from the previous week and was down 7% on an annual basis. "While conventional refinance applications have decreased despite the lower rates, there has been a rebound in refinances for Federal Housing Administration (FHA) and Veteran Affairs (VA) loans compared to the previous week," Kan mentioned. For 30-year fixed-rate mortgages with conforming loan balances of $766,550 or less, the average interest rate decreased from 6.86% to 6.69% over the past week.
For loans exceeding this amount, the rate fell from 6.97% to 6.85%. Additionally, for 15-year loans, the rate declined from 6.29% to 6.12% week-over-week. Fixed-rate mortgages with 30-year terms backed by FHA loans saw a drop in rates from 6.61% to 6.49% on a weekly basis. The share of FHA loans, commonly utilized by first-time home buyers and generally requiring smaller down payments, remained consistent at 16% of total applications, according to the report..