U.S. mortgage applications fell for a second consecutive week, reflecting a drop in demand for home purchase loans, an industry trade group said on Wednesday, adding evidence of softening in the once robust housing market.
The Mortgage Bankers Association said its seasonally adjusted index of mortgage application activity for the week ended July 21 decreased 1.3 percent to 533.8 from the previous week’s 540.8.
The MBA’s seasonally adjusted purchase mortgage index fell 2.4 percent to 389.0. The index, well below its year-ago level of 485.1, is considered a timely gauge of U.S. home sales.
The group’s seasonally adjusted index of refinancing applications increased 0.6 percent to 1,385.2. The index stood at 2,320.3 a year ago.
The refinance share of applications increased to 35.6 percent from 35.0 the previous week.
The number of applications for mortgages to buy homes dropped 2.4% last week, matching the three-year low reached four weeks ago, the Mortgage Bankers Association said Wednesday.
Applications for home-purchase loans are down about 20% in the past year.
The total number of applications fell 1.3% on a seasonally adjusted basis last week, the lowest level in four weeks. Applications for mortgage loans are down about 28% in the past 12 months, the bankers group said.
The decline in mortgage applications confirms other indications that the nation’s housing market is cooling significantly after providing a major boost to U.S. economic growth over the past four years.
Applications for refinance loans increased 0.6% last week, but they’re down about 47% in the past year as interest rates have moved higher.