Mortgage activity took the usual hit over the last two weeks as the country celebrated a variety of religious and secular holidays. The Mortgage Brokers Association (MBA) was closed during Christmas Week, so this morning’s report encapsulates the December 18 to December 29 period. MBA said its Market Composite Index, a measure of mortgage loan application volume, declined 9.4 percent on a seasonally adjusted basis compared to two weeks earlier. On an unadjusted basis, the Index decreased 38 percent.   The unadjusted Refinance Index fell 43 percent below its prior reported level but was 15 percent higher than the same week one year ago. The refinance share of mortgage activity accounted for 36.3 percent of total applications. The previously reported share was 39.4 percent. [refiappschart] The seasonally adjusted Purchase Index declined by 5 percent over the holiday period while the unadjusted Purchase Index fell 34 percent. The Index was down by 12 percent year-over-year. [purchaseappschart] Loan sizes, somewhat of a proxy for home prices, continued to trend lower. The average loan was $356,500 compared to $360,100 before the holidays. Purchase loans averaged $407,200, down from $416,000.  Markets continued to digest the impact of slowing inflation and potential rate cuts from the Federal Reserve, helping mortgage rates to stay at levels close to the lowest since mid-2023. The 30-year fixed mortgage rate edged higher last week and ended 2023 at 6.76 percent, over a percentage point lower than its recent peak of 7.9 percent in October 2023,” said Joel Kan, MBA’s Vice President and Deputy Chief Economist. “ The recent decline in rates has given the housing market some cause for optimism going into 2024 , but purchase applications have not yet picked up in response, with the overall level of purchase activity 12 percent lower than a year ago. Refinance applications were still at very low levels, but were 15 percent higher than a year ago.”