US mortgage applications rise 3.7% despite steady rates

By Ovunc Kutlu

ISTANBUL (AA) - US mortgage applications increased last week despite 30-year mortgage rates remaining almost steady, according to a report Wednesday by the Mortgage Bankers Association (MBA).

The market composite index, a measure of mortgage loan application volume, rose 3.7% on a seasonally adjusted basis for the week ending Feb. 2. On an unadjusted basis, the Index increased 8% compared with the previous week.

"Mortgage rates have stayed close to where they started the year, despite swings in Treasury yields because of slowing inflation offset by stronger than expected readings on the job market," Joel Kan, MBA’s vice president and deputy chief economist, said in a statement.

"Rates at these levels have not prompted much of a reaction in the refinance market, as most homeowners have mortgages with much lower rates," he added.

Kan noted that purchase activity has been strong to start this year, compared to the fourth quarter of 2023; but activity is still weaker than a year ago due to low housing supply.

The average contract interest rate for 30-year fixed-rate mortgages remained almost unchanged at 6.8%, last week, from 6.78% the week before, as it is still lower than the most recent peak of 7.9% recorded in October.

The average contract interest rate for 15-year fixed-rate mortgages, on the other hand, increased to 6.41% from 6.34%.

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