The number of mortgage applications in the U.S. fell for the third week in a row, but at a slower pace in the week ended October 18, as higher interest rates continue to weigh on demand, results of a survey by the Mortgage Bankers Association showed Wednesday.
The Market Composite Index, a measure of mortgage loan application volume, fell 6.7 percent from the previous week when it slumped 17 percent.
The average contract interest rate for 30-year fixed-rate mortgages was steady at 6.52 percent.
The purchase index fell 5 percent to 131.4 from 138.4 from the previous week and the refinance index plunged 8 percent to 672.6 from 734.6, the MBA survey showed.
Application activity decreased to its lowest level since July, as both purchase and refinance applications saw declines, Joel Kan, MBAs vice president and deputy chief economist, said.
Purchase applications continued to run stronger than last years pace for the fifth consecutive week.
Kan said some homebuyers are still in the market as rates, which are on a recent upswing, are over a full percentage point lower than a year ago.
For-sale inventory has started to loosen, and home-price growth has eased in some markets, providing more options for buyers in combination with these lower rates, Kan added.
The weekly MBA survey covers U.S. closed-end residential mortgage applications originated through retail and consumer direct channels and respondents include mortgage bankers, commercial banks, thrifts, and credit unions.