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MBA US Mortgage Applications Rebound in Week Ended May 7 on Mortgage Rate Dip

05/12/2021 03:09

07:00 AM EDT, 05/12/2021 (MT Newswires) -- Mortgage applications rebounded by 2.1% in the week ended May 7 due to gains in both refinancing activity and new home applications as 30-year fixed mortgage rates fell to three-month lows, according to Mortgage Bankers Association data released Wednesday.

This follows an 0.9% decline in overall activity in the week ended April 30.

Applications for refinancing loans rose by a seasonally adjusted 3%, while new purchase applications rose by a seasonally adjusted 1%.

The average contract interest rate for 30-year fixed mortgages with loan balances $548,250 or less fell to 3.11% from 3.18% in the previous week.

"Mortgage rates fell last week to the lowest levels since February, tracking the dip in Treasury yields," said Joel Kan, MBA's associate vice president of Economic and Industry Forecasting, noting that refinancing activity was highest in eight weeks, while new applications were up 13% from the same week a year ago.

"Most markets this spring continue to see robust demand, but activity continues to be constrained by insufficient inventory levels, as well as homebuilder challenges related to the ongoing shortages and price increases for building materials," he added.