T
he Mortgage Bankers Association's latest survey shows a slight decrease in U.S. mortgage applications, down 0.1 percent from the previous week. The Market Composite Index, which measures loan application volume, also decreased by 0.1 percent on a seasonally adjusted basis.

    Refinance applications dropped 6 percent from the previous week but remain 84 percent higher than the same period last year. In contrast, purchase applications increased 5 percent and were 10 percent higher than the same time last year.

    According to Joel Kan, MBA's Vice President and Deputy Chief Economist, "Mortgage applications were essentially flat last week as rates rose for the fourth time in five weeks due to bond market volatility." The 30-year fixed rate reached its highest level since July at 6.73 percent.

    Purchase activity has weakened in recent weeks, but Kan expects housing demand from younger homebuyers to support growth over the next few years as inventory loosens. Refinance applications accounted for a smaller share of total activity, decreasing to 43.1 percent from 45.7 percent the previous week.

    The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances increased to 6.73 percent, while rates for jumbo loans and FHA-backed mortgages also rose. The effective rate increased across all loan types last week.