The absence of super low mortgage rates killed refinance activity last week, revealing just how weak the mortgage market is without government manipulation, according to the MBA.
Mortgage application volume slipped 16.2 on a seasonally adjusted basis (35.2 percent unadjusted) during the week ending May 29, but was still up 14.4 percent compared with the same week a year earlier, when activity was dismal.
Once hot refinance activity plunged a staggering 24.1 percent during the week while purchase activity increased 4.3 percent.
That pushed the refinance share of mortgage activity to just 62.4 percent of total applications from 69.3 percent a week earlier; it had been as high as 80 percent only weeks ago.
Meanwhile, mortgage rates surged higher as the Fed lost control and long-term bond yields got away from them.
The benchmark 30-year fixed averaged 5.25 percent, up from 4.81 percent a week earlier, while the 15-year fixed increased to 4.80 percent from 4.44 percent.
The one-year ARM also worsened, climbing to 6.61 percent from 6.55 percent, though the adjustable-rate mortgage share of activity increased to three percent from 2.6 percent.
The MBA’s weekly survey, conducted since 1990, covers about half of retail residential loan applications, but does not factor out declined or multiple applications.
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