Mortgage loan application volume in the U.S. dropped nearly 4 percent on a seasonally adjusted basis and 5 percent in the absolute over the past week, with a 4 percent drop in purchase mortgage activity, which is now 23 percent lower than at the same time last year and dropping, with purchase demand “continu[ing] to shrink” despite rising inventory levels and a rapid deceleration in values, according to data from the Mortgage Bankers Association’s.

At the same time, the average purchase loan size has been dropping as well, in part due to a pronounced “weakening” of activity at the high end of the market, a weakening which hit the low end of the market months ago. And as we outlined last week, “the change in the mix of sales which has been distorting median sale price trends, which are frequently conflated with “appreciation,” is starting to normalize.”

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  1. UPDATE: Having ticked down another 3 percent in the absolute over the past week, purchase mortgage activity across the nation remains 23 percent lower than the same time last year, with “no sign of a rebound,” according to the Mortgage Bankers Association.

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