WASHINGTON (9/12/14)--Even accounting for the Labor Day holiday, mortgage applications stumbled this week, sinking by 7.2%, according to data from the Mortgage Bankers Association's weekly mortgage application survey (Economy.com Sept. 10).
Refinance applications fueled the drop with a 10.7% retreat for the week, while purchase applications fell by 2.6%.
On a four-week moving average, refinance activity has gained 0.5% over the past month, but still sits 25% lower than this time last year. Refinance applications currently constitute about 55% of all applications.
Purchase activity, meanwhile, has declined 1.3% over the last month and falls 11.6% below year-ago levels.
With these latest readings, the overall mortgage application gauge has hit its lowest level since 2000.
"There appears to be little impetus for purchase activity to noticeably improve over the next few months, given that most Americans are just doing OK, but not great," said Gregory Bird, Moody's analyst (Economy.com).
Mortgage rates also continue to hover near their record-low post-recession levels.
The 30-year fixed-rate conforming mortgage rate climbed 2 basis points to 4.27% for the week, which is 8 points below the rate seen four weeks ago and 53 points below levels this time last year.
Five-year adjustable-rate mortgage rates fell by 7 basis points down to 3.12%, which is 47 basis points lower year-over-year.