Global| Aug 28 2019U.S. Weekly Mortgage Loan Applications Fall Again as Rates Tick Up
by:Sandy Batten
|in:Economy in Brief
Summary
The Mortgage Bankers Association reported that its total Mortgage Applications Index fell 6.2% w/w (+67.5% y/y) during the week ending August 23, as mortgage interest rates ticked up, following a 0.9% w/w decline in the previous week. [...]
The Mortgage Bankers Association reported that its total Mortgage Applications Index fell 6.2% w/w (+67.5% y/y) during the week ending August 23, as mortgage interest rates ticked up, following a 0.9% w/w decline in the previous week. Applications to refinance a loan slumped 7.6% w/w (+167.1% y/y), their first weekly decline in five weeks, after a 0.4% w/w rise in the previous week. With mortgage interest rates generally falling over the course of 2019, mortgage refinancing has been on a tear. Purchase applications declined 4.0% w/w (+1.7% y/y), their sixth weekly decline in the past seven weeks.
The effective interest rate on a 15-year fixed-rate mortgage edged up to 3.40% from 3.39% in the prior week. It remained just above the lowest rate since November 2016 and well below the recent high of 4.71% reached in early November 2018. The effective rate on a 30-year fixed-rate loan rose to 4.05% from 4.00%, but remained well below the November high of 5.33%. The effective rate on a 30-year Jumbo mortgage increased slightly to 3.97% from 3.95%. It remained below the October peak of 5.09%. The rate on an adjustable 5-year mortgage rose to 3.57% from 3.50%.
The average mortgage loan size slipped to $339,500 from $344,700 in the previous week. For purchases, the average loan size edged up to $326,600 from $323,500. The average loan size for refinancings fell for the second consecutive week to $347,300 from $357,400.
Applications for fixed-rate loans fell 5.9% w/w (+67.9% y/y), while adjustable rate loan applications slumped 11.0% w/w (61.8% y/y).
The survey covers over 75% 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.
| MBA Mortgage Applications (%, SA) | 8/23/2019 | 8/16/2019 | 8/9/19 | Y/Y | 2018 | 2017 | 2016 |
|---|---|---|---|---|---|---|---|
| Total Market Index | -6.2 | -0.9 | 21.7 | 67.5 | -10.4 | -17.8 | 15.6 |
| Purchase | -4.0 | -3.5 | 1.9 | 1.7 | 2.1 | 5.6 | 13.3 |
| Refinancing | -7.6 | 0.4 | 36.9 | 167.1 | -24.3 | -34.0 | 17.3 |
| 15-Year Mortgage Effective Interest Rate (%) | 3.40 | 3.39 | 3.37 | 4.37 (Aug '18) | 4.35 | 3.59 | 3.22 |
Sandy Batten
AuthorMore in Author Profile »Sandy Batten has more than 30 years of experience analyzing industrial economies and financial markets and a wide range of experience across the financial services sector, government, and academia. Before joining Haver Analytics, Sandy was a Vice President and Senior Economist at Citibank; Senior Credit Market Analyst at CDC Investment Management, Managing Director at Bear Stearns, and Executive Director at JPMorgan. In 2008, Sandy was named the most accurate US forecaster by the National Association for Business Economics. He is a member of the New York Forecasters Club, NABE, and the American Economic Association. Prior to his time in the financial services sector, Sandy was a Research Officer at the Federal Reserve Bank of St. Louis, Senior Staff Economist on the President’s Council of Economic Advisors, Deputy Assistant Secretary for Economic Policy at the US Treasury, and Economist at the International Monetary Fund. Sandy has taught economics at St. Louis University, Denison University, and Muskingun College. He has published numerous peer-reviewed articles in a wide range of academic publications. He has a B.A. in economics from the University of Richmond and a M.A. and Ph.D. in economics from The Ohio State University.
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