Total mortgage applications gave back last week most of the prior week's surge and fell 7.2, according to the Mortgage Bankers Association. Applications nevertheless remained 2.6% above the June average which rose 9.9% versus May.

Purchase applications fell 6.1% w/w after the 9.1% jump the prior period and in July are 2.7% above June which rose 1.3% from May. During the last ten years there has been a 50% correlation between the y/y change in purchase applications and the change in new plus existing single family home sales.

Applications to refinance fell for the third week in the last four but in July are 2.4% ahead of June.

The effective interest rate on a conventional 30-year mortgage increased for the second week and rose to 5.87%. The effective rate on a 15-year mortgage also rose to 5.53% after falling from the peak of 5.96%.

The Mortgage Bankers Association surveys between 20 to 35 of the top lenders in the U.S. housing industry to derive its refinance, purchase and market indexes. The weekly survey accounts for more than 40% of all applications processed each week by mortgage lenders. Visit the Mortgage Bankers Association site here.