WASHINGTON, April 24 (Xinhua) -- Mortgage applications in the United States decreased last week as mortgage rate rose in the housing market, the Mortgage Bankers Association (MBA) said Wednesday.
For the week ending April 19, the MBA's market composite index, a measure of mortgage loan application volume, dropped 7.3 percent from a week earlier.
The MBA's data also showed that the refinance index, a measurement of mortgage refinance activity, dropped 11 percent from the previous week.
"The 30-year fixed mortgage rate has risen 10 basis points in three weeks, and is now at its highest level in over a month," said Mike Fratantoni, senior vice president and chief economist of the MBA.
"Borrowers remain extremely sensitive to rate changes, which is why there has been a 28 percent drop in refinance applications over this three-week period," Fratantoni said.
Latest data from the U.S. Federal Home Loan Mortgage Corporation, commonly known as Freddie Mac, showed that the interest rate of 30-year fixed-rate mortgage in the United States rose to 4.17 percent for the week ending April 18, up from previous week's 4.12 percent.
"The strong economy and job market is keeping buyer interest high, but rising mortgage rates could add pressure to the budgets of some would-be buyers," said Fratantoni.
In line with the decrease in application and refinance activities, the seasonally adjusted purchase index decreased 4 percent from one week earlier, according to the MBA.
"Purchase activity also declined, but remains almost 3 percent higher than a year ago," said Fratantoni. "Borrowing costs have recently drifted higher because of ebbing geopolitical concerns, as well as signs of strengthening in the U.S. economy, including the recent data pointing to robust retail sales."
