U.S. mortgage applications fell for the fifth consecutive week, largely reflecting a drop in demand for home purchase loans, an industry trade group said Wednesday.
The Mortgage Bankers Association said its seasonally adjusted index of mortgage application activity, which includes both refinancing and purchasing loans, for the week ended April 13 dropped 2.5% to 630.6.
The four-week moving average of mortgage applications, which smooths the volatile weekly figures, declined 1.6%.
Borrowing costs on 30-year fixed-rate mortgages, excluding fees, averaged 6.22%, up 0.06 percentage point from the previous week, its highest since early February. Interest rates, however, were significantly below year-ago levels of 6.56%.
Weighing on the housing sector is an unwieldy supply of homes for sale. Also contributing to the cooling of the housing market is the meltdown in the subprime mortgage market, which has driven lenders to tighten underwriting standards.
The MBA's seasonally adjusted purchase index, widely considered a timely gauge of U.S. home sales, fell 4.2% to 396.5, its first drop below the 400 threshold since the middle of February. The index was below its year-ago level of 407.4.
The group's seasonally adjusted index of refinancing applications decreased 0.3% to 2,008.4. A year earlier the index stood at 1,526.1.
The refinance share of applications increased to 43.6% from 42.8% the previous week.
Fixed 15-year mortgage rates averaged 5.92%, up from 5.91%. Rates on one-year adjustable-rate mortgages (ARMs) increased to 5.89% from 5.88%.
The ARM share of activity decreased to 18.1% from 18.7% the previous week.
U.S. housing industry indexes, in general, tend to be volatile and have recently painted a mixed picture, with some pointing to weakening and others to stabilization in the hard-hit sector.
The MBA's survey covers about 50% of all U.S. retail residential loans. Respondents include mortgage banks, commercial banks and thrifts.