“Mortgage applications increased for the first time in three weeks, with refinances up 5%,” said Mike Fratantoni, MBA’s senior vice president and chief economist. “Even with the increase, which included a 29% jump in VA refinances, refinance application volume remains about 6% below last year’s already low levels.”
The rebound in applications coincided with a drop in mortgage rates, providing some relief to prospective homebuyers. The 30-year fixed mortgage rate decreased 11 basis points to 7.18%, while the FHA rate fell 17 basis points to 6.92%.
“Treasury rates and mortgage rates fell last week on the news of a slowing job market, with wage growth at the slowest pace since 2021, and the Federal Reserve’s announced plans to ease quantitative tightening in June and to maintain its view that another rate hike is unlikely,” Fratantoni said.
While overall purchase activity was up modestly, Fratantoni noted the gain was concentrated in the government loan segment, which is gaining popularity among first-time homebuyers.
The FHA share of total applications rose two basis points to 12.9% week over week, and the VA share increased four basis points to 11.7%. The USDA share of total applications remained unchanged at 0.4%.
