According to the Mortgage Bankers Association, demand for mortgage loans soared last week as a gloomy economic outlook resulted in a drop in rates (MBA). As a result, for the week ending July 29, the market composite index, which tracks the amount of mortgage loan applications, gained 1.15% after dropping for four straight weeks to its lowest point in more than two decades. Last week, the refinanced index increased 1.45% from the week before. The buying index, meanwhile, increased 0.97% over that time.

Borrower demand, though, is sluggish as compared to last year. According to MBA data, the market index decreased 62% from the same week in 2021. In addition, the purchase index was 15.8% lower than last year’s, and the refi index was down 82.6% in the same time frame.

In June, for-sale inventory increased by the most during a single month in 12 years, setting a record low for home price appreciation, according to the Black Knight’s monthly mortgage monitor report, which indicates a cooling in the housing market. According to the MBA data, the share of refinancing in all mortgage activity stayed essentially unchanged this week, going to 30.8% of all applications from 30.7% the week before.

The proportion of total applications handled by the Federal Housing Administration (FHA) decreased from 12.1% the previous week to 11.9%. The United States Department of Agriculture (USDA) portion remained constant at 0.6%, while the Veterans Affairs (V.A.) share climbed to 10.8% from 10.6%. The poll, conducted every week since 1990, covers 75% of all retail and residential mortgage applications in the United States. To read more on the position of mortgage demand in the market, click here.

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