Global| Jun 11 2014U.S. Mortgage Loan Applications Bounce Back; Interest Rates Creep Higher
by:Tom Moeller
|in:Economy in Brief
Summary
The Mortgage Bankers Association reported that their total Mortgage Market Volume Index increased 10.3% last week (-42.3% y/y) following two weeks of decline. Nevertheless, applications remained two-thirds below the peak in September [...]
The Mortgage Bankers Association reported that their total Mortgage Market Volume Index increased 10.3% last week (-42.3% y/y) following two weeks of decline. Nevertheless, applications remained two-thirds below the peak in September 2012. Applications to refinance an existing loan rose 11.0% (-54.0% y/y) to the highest level since mid-March while home purchase applications rose 9.3% (-13.6% y/y) to the highest level since late-January.
The effective interest rate on a 15-year mortgage rebounded last week to 3.49%, the highest level in four weeks. The effective rate on a 30-year fixed rate loan increased to 4.39%. The rate on a Jumbo 30-year loan gained to 4.30%. For adjustable 5-year mortgages, the effective interest rate jumped to 3.31%, its highest level since early-May.
The average mortgage loan size fell back to $247,000. The average loan size for home purchases declined to $276,300 and for refinancings it fell to $221,600.
Applications for fixed interest rate loans declined 42.9% y/y while adjustable rate loan applications were off by 34.2% y/y.
The survey covers over 75 percent of all U.S. retail residential mortgage applications, and has been conducted weekly since 1990. Respondents include mortgage bankers, commercial banks and thrifts. The base period and value for all indexes is March 16, 1990=100. The figures for weekly mortgage applications and interest rates are available in Haver's SURVEYW database.
Financial Stability and Monetary Policy: Happy Marriage or Untenable Union? from the Federal Reserve Bank of San Francisco is available here.
| MBA Mortgage Applications (SA, 3/16/90=100) | 06/06/14 | 05/30/14 | 05/23/14 | Y/Y% | 2013 | 2012 | 2011 |
|---|---|---|---|---|---|---|---|
| Total Market Index | 387.1 | 350.8 | 362.2 | -42.3 | 616.6 | 813.8 | 572.3 |
| Purchase | 187.5 | 171.6 | 178.1 | -13.6 | 197.5 | 187.8 | 182.6 |
| Refinancing | 1,528.9 | 1,377.4 | 1,418.6 | -54.0 | 3,070.0 | 4,505.0 | 2,858.4 |
| 15-Year Mortgage Effective Interest Rate (%) | 3.49 | 3.41 | 3.44 | 3.56 (6/13) |
3.42 | 3.25 | 3.97 |
Tom Moeller
AuthorMore in Author Profile »Prior to joining Haver Analytics in 2000, Mr. Moeller worked as the Economist at Chancellor Capital Management from 1985 to 1999. There, he developed comprehensive economic forecasts and interpreted economic data for equity and fixed income portfolio managers. Also at Chancellor, Mr. Moeller worked as an equity analyst and was responsible for researching and rating companies in the economically sensitive automobile and housing industries for investment in Chancellor’s equity portfolio. Prior to joining Chancellor, Mr. Moeller was an Economist at Citibank from 1979 to 1984. He also analyzed pricing behavior in the metals industry for the Council on Wage and Price Stability in Washington, D.C. In 1999, Mr. Moeller received the award for most accurate forecast from the Forecasters' Club of New York. From 1990 to 1992 he was President of the New York Association for Business Economists. Mr. Moeller earned an M.B.A. in Finance from Fordham University, where he graduated in 1987. He holds a Bachelor of Arts in Economics from George Washington University.
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