Texas storm deflates mortgage application numbers

Mortgage applications decreased 11.4% from one week earlier, according to data from the Mortgage Bankers Association’s weekly survey for the week ending Feb. 19.

It’s the lowest level applications have fallen to since December 2020.

Activity decreased across the board, with the unadjusted index (-10%), the refinance index (-11%), the seasonally adjusted purchase index (-12%) and the unadjusted purchase index (-8%) all falling from the previous week.

The severe winter weather in Texas played played a prominent role in the survey’s declining numbers, according to Joel Kan, MBA’s associate vice president of economic and industry forecasting.

“[The storm]affected many households and lenders, causing more than a 40% drop in both purchase and refinance applications in the state last week,” Kan said. “Mortgage rates have increased in six of the last eight weeks, with the benchmark 30-year fixed rate last week climbing above 3% to its highest level since September 2020.”

The refinance share of mortgage activity decreased to 68.5% of total applications from 69.3% the previous week. The adjustable-rate mortgage share of activity increased to 2.7% of total applications.

“The housing market in most of the country remains strong, with activity last week 7% higher than a year ago,” Kan said.

The higher-priced segment of the market continues to perform well, Kan said, with the average purchase loan size increasing to a survey-high of $418,000.

The FHA share of total mortgage applications increased to 11.2% from 9% the week prior. The VA share of total mortgage applications decreased to 11.9% from 13.2% the week prior.

Here is a more detailed breakdown of this week’s mortgage application data:

  • The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($548,250 or less) increased to 3.08% from 2.98%
  • The average contract interest rate for 30-year fixed-rate mortgages with jumbo loan balances (greater than $548,250) decreased to 3.23% from 3.11% – the fifth straight week of decreases
  • The average contract interest rate for 30-year fixed-rate mortgages increased to 3% from 2.93%
  • The average contract interest rate for 15-year fixed-rate mortgages increased to 2.56% from 2.47%
  • The average contract interest rate for 5/1 ARMs remained unchanged at 2.83%

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