US mortgage applications continue to fall

Mortgage applications in the US fell by 2.5 per cent last week from the week before, according to survey data from the Mortgage Bankers Association (MBA). This follows a 4.6 per cent fall the week before.

The average contract interest rate for 30-year fixed-rate mortgages increased by 12 basis points to 4.8 per cent in the week ended 23 August - a 29-month high.

The refinance index fell by five per cent, bringing the total fall from the 3 May peak to 64.2 per cent. Refinance activity has fallen in 14 of the last 16 weeks.

The refinance share of mortgage activity fell to 60 per cent from 61 per cent the week before – the lowest since April 2011.

The purchase index increased two per cent from the week before.