NEW YORK U.S. mortgage application activity fell from a nearly four-month peak as borrowing costs on 30-year home loans held at their highest level almost three years, Mortgage Bankers Association data released on Wednesday showed.
The Washington-based industry group said its measure on mortgage applications fell 2.7 percent to 406.8 in the week ended on March 17. Last week, it was 418.1, which was the highest level since 460.30 in the week ended on Nov. 18.
Average interest rates on 30-year, fixed-rate conforming mortgages, the most widely held type of U.S. home loan, held for a second week at 4.46 percent, a level last seen in April 2014.
Conforming loans are those with balances of $424,100 or less and that qualify for guarantees from federal mortgage agencies Fannie Mae (FNMA.PK) and Freddie Mac (FMCC.PK).
Rates on conforming 30-year loans were steady despite a decline in benchmark U.S. Treasury yields US10YT=RR following the Federal Reserve's assurance after a two-day policy meeting that it still planned to raise rates gradually.
Mortgage rates on some fixed-rate home loans that the MBA tracks increased from the preceding week. The 30-year rate on loans backed by the Federal Housing Administration averaged 4.33 percent, the highest since January 2014.
The group's seasonally adjusted gauge of applications to refinance an existing home loan fell 3.3 percent to 1,366.1. Last week, it reached 1,413.3, the highest since the week ended on Dec. 16.
The share of refinancing applications slipped to 45.1 percent from 45.6 percent the previous week, MBA said.
The MBA's seasonally adjusted gauge of purchase application activity, a proxy for future home sales, decreased 2.1 percent to 235.3. Last week, it was 240.3, the highest since the week ended on Jan. 20.
The share of applications for adjustable-rate mortgages grew to 9.0 percent, its largest since October 2014.
(Reporting by Richard Leong; Editing by Lisa Von Ahn)