Despite the three-day week observed by most businesses last week, purchase mortgage applications more than held their own. The Mortgage Bankers Association (MBA) said its seasonally adjusted Purchase Index gained 5 percent for the week although it lost 31 percent on an unadjusted basis. It was 19 percent lower than the same week in 2022, also a holiday week. [purchaseappschart] The Refinance Index did not fare nearly as well. It was down 9 percent from the previous week and was 1 percent higher than the same week one year ago. The refinance share of mortgage activity decreased to 30.6 percent of total applications from 32.4 percent the prior week. [refiappschart] As a result, the Market Composite Index, a measure of all mortgage application volume, eked out a 0.3 percent gain on a seasonally adjusted basis from one week earlier and fell by 33 percent before adjustment. “Mortgage rates decreased for the fourth time in five weeks, with the 30-year fixed rate dipping to 7.37 percent, the lowest level in 10 weeks. There was a slight increase in applications overall, driven by a five percent increase in purchase applications, but refinance applications decreased over the week,” said Joel Kan, MBA’s Vice President and Deputy Chief Economist. “Rates have declined more than 50 basis points over the past six weeks, which has helped to spur a small increase in purchase applications, but activity last week was still around 20 percent lower than a year ago. The purchase market remains depressed because of the ongoing, low supply of existing homes on the market. Similarly, refinance activity will likely be muted for some time, even with the recent decline in rates, as many borrowers locked in much lower rates in 2020 and 2021.”