Housing Bubble

Purchase Index reaches new record in latest MBA survey

May 08, 2003

Washington, D.C. (May 7, 2003) – The Market Composite Index of mortgage loan applications – a measure of mortgage loan applications for purchases and refinancings – for the week ending May 2 increased to 1246.6 on a seasonally-adjusted basis from 1050.8 one week earlier, according to the Weekly Mortgage Applications Survey of the Mortgage Bankers Association of America (MBA), which was released today. On an unadjusted basis, the Index increased by 18.8 percent and was up 106.1 percent compared to the same week a year earlier.

The MBA seasonally adjusted Purchase Index increased to a new record high of 416.0 from 356.0 the previous week. The previous record of 414.0 was reached the week ending May 31, 2002.

“Applications activity for home purchases is typically strong at this time of the year as consumers put in applications for home purchases that occur in the summer,” noted MBA economist Phil Colling. “Near-record low interest rates and an upturn in consumer confidence are also likely to have contributed to the record high purchase index.”

The seasonally adjusted Refinance Index increased to 6077.8 from 5092.0 one week earlier. Other seasonally adjusted index activity included the Conventional Index, which increased to 1790.7 from 1514.7 the previous week. The Government Index increased to 338.7 from 276.6 the previous week.

Refinancing activity increased to 68.7 of total applications from 68.4 percent the previous week. The share of ARM activity decreased to 13.1 percent from 14.3 percent the previous week.

Source: Mortgage Bankers Association of America