Mortgage Apps: Another Sharp Drop, Record Low for Purchases

Bottom Line:  Mortgage rates rose sharply again last week, rebounding to 6.84% from 6 3/8% in late January on the average 30-year fixed rate. Purchase applications hit a new low as applications for refinancing edged lower. Despite most homeowners enjoying fixed rates below 4%, the mortgage market remains remarkably sensitive to moves in mortgage rates.  Before the sudden rebound in mortgage rates, applications appeared to be finding a bottom. But that is now in question and bears close watching as rate, and spread volatility has started to increase again.The MBA Mortgage Application Index FELL sharply, DOWN -13.3% to 200.0, BELOW the 13-week average of 217.0 and -57.2% BELOW the year-ago level. Non-seasonally adjusted the index FELL slightly, DOWN -3.7%.
 
The Purchase Index FELL sharply, DOWN -18.1% to 147.0, BELOW the 13-week average of 179.0 and -41.3% BELOW the year-ago level.
 
The Refinancing Index FELL slightly, DOWN -2.2% to 470.0, ABOVE the 13-week average of 404.0 but -72.0% BELOW the year-ago level.
 
The effective (adjusted for points paid) 30-year mortgage rate ROSE sharply, UP 24bps to 6.84%, ABOVE the 13-week average of 6.57% and 63bps ABOVE the year-ago level.Current coupon yields in the secondary market were up 7.0 bps last week, closing at 5.38%, and were up 22.0 bps this week through Tuesday.