MBA's Weekly Mortgage Application Survey also revealed a decrease in the Refinance Index, which went down by 1.9 percent compared to the week ending December 16. The seasonally adjusted Purchase Index decreased by 9.7 percent between the week ending December 16 and the week ending December 30.
The survey covered 75 percent of all U.S. retail residential mortgage applications and has been recorded weekly since 1990.
“Mortgage application activity declined over the last two weeks, even after adjusting for the typical seasonal decline in activity," said Michael Fratantoni, vice president of research and economics for the MBA. "Refinance applications continue to account for the vast majority of total application volume, with the refinance share reaching its highest level in 2011. As part of legislation to extend the payroll tax holiday, guarantee fees for loans purchased by the GSEs and mortgage insurance premiums for FHA loans will eventually increase."
The Market Composite Index, measuring the total loan application volume, and the refinance share of mortgage activity increased, despite decreases in other areas of the study. The MCI application volume was 39 percent higher in the last two weeks of 2011 than during the same period in 2010, while the refinance share of mortgage activity for the week ending in December 30 increased to 81.9 percent of total applications.
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