Mortgage applications barely budged last week, despite recent reports of a surge in home sales, data from the Mortgage Bankers Association (MBA) show.
Total application volume fell 0.2 percent week-to-week, according to the MBA, and is now down nearly 37 percent on year. While refinance volume has dropped by nearly half from a year ago and was essentially flat week-to-week, applications to purchase a home are not improving as expected. They fell one percent on week on a seasonally adjusted basis and are down nearly 16 percent on year.
This comes amid an improvement in home sales. Sales of both new and existing homes rose in May, as pent-up demand from the slow winter months was unleashed. Those numbers, however, are backward-looking, while mortgage applications portend sales in the coming months. The stall in mortgage volume therefore could mean slower sales in the second half of the year, much as the National Association of Realtors has predicted.
"Applications are certainly down across the board," said Matt Weaver, Florida-based vice-president of mortgage banking at PMAC Lending Services. "We feel that this is a direct connection to children recently being out of school and the start of summer and vacationing."