Rates held firm at 2016 lows, but buyers were in no hurry to take out a mortgage loan this week after the Fed left the option of a June rate increase on the table.
Last week it averaged 3.57 percent, and a year ago at this time, the 30-year FRM averaged 3.84 percent, the report said. The 15-year FRM this week averaged 2.81 percent with an average 0.5 point, unchanged from last week. A year ago at this time, the 15-year FRM averaged 3.05 percent.
According to Freddie Mac, the 5-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) averaged 2.80 percent this week with an average 0.5 point, up from last week when it averaged 2.78 percent. A year ago, the 5-year ARM averaged 2.88 percent.
Sean Becketti, Chief Economist, Freddie Mac said, "The 10-year Treasury yield saw minimal movement over the past week, despite encouraging news from April's consumer spending and CPI data. Accordingly, the 30-year mortgage rate moved up just 1 basis point from its 2016 low to 3.58 percent. Although there was minimal change in rates this week, the hawkish tone of Wednesday's Fed minutes release had an immediate impact on Treasury yields, and could possibly shake up next week's survey results."
Mortgage applications did not align with low rates this week. According to data from the Mortgage Bankers Association's (MBA) Weekly Mortgage Applications Survey for the week ending May 13, 2016, mortgage applications fell 1.6 percent from one week earlier.
On an unadjusted basis, the index decreased 2 percent compared with the previous week, the MBA said. The refinance index increased 1 percent from the previous week. The seasonally adjusted purchase index decreased 6 percent from one week earlier to the lowest level since February 2016. The unadjusted purchase index decreased 6 percent compared with the previous week and was 12 percent higher than the same week one year ago.
The MBA found that the refinance share of mortgage activity increased to 54.7 percent of total applications from 52.8 percent the previous week. Meanwhile, the adjustable-rate mortgage (ARM) share of activity decreased to 5.5 percent of total applications.
The FHA share of total applications decreased to 12.6 percent from 13.0 percent the week prior, the VA share of total applications increased to 12.2 percent from 11.7 percent, and the USDA share of total applications remained unchanged at 0.7 percent, according to the report.