On an unadjusted basis, the composite index decreased by 1% week over week. The seasonally adjusted purchase index fell by 4% compared to the week ended July 31. The unadjusted purchase index also decreased by 4% for the week and is now 20% higher year over year.
The MBA’s refinance index increased by 3% week over week to its highest level since May, and the percentage of all new applications that were seeking refinancing rose slightly from 51.3% to 53.1%, the highest the refinancing share has been since April.
Adjustable rate mortgage loans accounted for 6.8% of all applications, unchanged from the prior week.
The surprise devaluation of China’s currency also affects the U.S. home mortgage market indirectly but meaningfully. While China’s goal with the devaluation may have been to make its exports more attractive, the action sends a larger message that economic growth may be stalled or worse. When investors see signals that the global economy is not expanding, they tend to invest less with equities and more with bonds. That helps keep mortgage rates down.
According to the MBA, last week’s average mortgage loan rate for a conforming 30-year fixed-rate mortgage remained unchanged 4.13%. The rate for a jumbo 30-year fixed-rate mortgage also remained unchanged at 4.08%. The average interest rate for a 15-year fixed-rate mortgage rose from 3.36% to 3.39%.
The contract interest rate for a 5/1 adjustable rate mortgage loan increased from 3.02% to 3.11%. Rates on a 30-year FHA-backed fixed-rate loan dropped from 3.96% to 3.94%.
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