US mortgage applications rise 0.9% as rates jump to 8-month high

By Ovunc Kutlu

ISTANBUL (AA) - Mortgage applications in the US rose 0.9% last week as rates jumped to the highest level in eight months, according to a report Wednesday by the Mortgage Bankers Association (MBA).

The Market Composite Index, a measure of mortgage loan application volume, increased 0.9% on a seasonally adjusted basis for the week ending July 7, compared to the previous week. On an unadjusted basis, however, the index plummeted 19%.

The 30-year fixed mortgage rate jumped to 7.07% -- the highest rate since November 2022.

"Purchase applications increased, but remained at a very low level and are 26 percent lower than the same week last year," MBA Vice President and Deputy Chief Economist Joel Kan said in a statement.

"Incoming economic data continue to send mixed signals about the economy, with the overall impact leaving Treasury yields higher last week as markets expect that the Federal Reserve will need to hold rates higher for longer to slow inflation," he added.

The average contract interest rate for a 15-year fixed-rate mortgage increased to 6.42%, from 6.3%, for the week.

The MBA survey covers more than 75% of US retail residential mortgage applications.