Thanksgiving had its usual effect on the mortgage market during the week ended November 25, although the third week of easing interest rates helped move the volume of purchase mortgage applications higher. The Mortgage Brokers Association (MBA) said its Market Composite Index, a measure of application volume, decreased 0.8 percent on a seasonally adjusted basis from the prior week. Results were adjusted to account for the holiday-shortened week. The unadjusted index dropped by 33 percent. The Refinance Index decreased 13 percent from the previous week and was 86 percent lower than the same week one year ago. Applications for refinancing constituted 26.1 percent of the total, down from 28.4 percent the previous week. [refiappschart] The seasonally adjusted Purchase Index gained ground for the fourth straight week , increasing 4 percent from one week earlier. The unadjusted Purchase Index was 31 percent lower than the prior week and down 41 percent year-over-year. [purchaseappschart] “Mortgage rates declined again last week, following bond yields lower. The 30-year fixed mortgage rate decreased to 6.49 percent and has now fallen 57 basis points over the past four weeks,” Joel Kan, MBA’s Vice President and Deputy Chief Economist said. Additionally, mortgage rates for most other loan types declined,” “The economy here and abroad is weakening, which should lead to slower inflation and allow the Fed to slow the pace of rate hikes,” he continued. “Purchase activity increased slightly after adjusting for the Thanksgiving holiday, but the decline in rates was still not enough to bring back refinance activity. Refinance applications fell another 13 percent, and the refinance share of applications was at 26 percent. Both measures were at their lowest levels since 2000.”
