Mortgage Apps: Further Stabilization

Bottom Line:  Despite historically high mortgage rates (30-year fixed still over 6.5%) and bank failures, mortgage applications continued to rise modestly over the last four weeks. Gains were led by applications for refinancing last week as purchase applications also rose modestly. Overall, while the level of mortgage applications remains historically low, the increase in applications coincides with continued hints of stabilization in the housing market. Despite the financial market turbulence, there is still underlying demand for housing that appears likely to stabilize the residential market as it rebalances to a new equilibrium after a record move in mortgage rates last year.The MBA Mortgage Application Index ROSE 2.9% to 227.0, ABOVE the 13-week average of 216.0 but -46.5% BELOW the year-ago level. Non-seasonally adjusted the index ROSE slightly, UP 3.0%.
 
The Purchase Index ROSE 2.0% to 173.0, ABOVE the 13-week average of 172.0 but -35.3% BELOW the year-ago level.
 
The Refinancing Index ROSE 4.8% to 504.0, ABOVE the 13-week average of 432.0 but -61.1% BELOW the year-ago level.
 
The effective (adjusted for points paid) 30-year mortgage rate FELL slightly, DOWN -4bps to 6.63%, BELOW the 13-week average of 6.66% but 34bps ABOVE the year-ago level.
 
Current coupon yields in the secondary market were down -11.0 bps last week, closing at 4.92%, and were up 25.0 bps this week through Tuesday.