U.S. Mortgage Applications Declined Again in the Last Week of October
Summary
- Total applications declined again in the latest week.
- Mortgage interest rates were relatively stable.
- Applications for purchase loans & refinancing declined.
Mortgage applications declined 2.1% (-19.1% y/y) in the week of October 27 after falling 1.0% (-17.9% y/y) in the week ended October 20, according to the Mortgage Bankers Association Weekly Mortgage Applications Survey. Applications for loans to purchase a home decreased 1.4% (-22.0% y/y) in the latest week after falling 2.2% (-21.5% y/y) in the previous week. Applications to refinance a loan dropped 3.5% (-11.6% y/y) following a 1.8% (-8.3% y/y) rise in the prior week.
The effective interest rate on a 30-year fixed rate loan was slightly lower at 8.07% in the week ended October 27, from 8.12% in the week ended October 20. The effective rate on a 15-year fixed-rate loan was unchanged at 7.44% from the prior week. The rate on a 30-year Jumbo loan was largely unchanged at 7.99% in the latest week from 7.98%, while the rate on the 5-year adjustable-rate mortgage rose to 7.31% from 7.25%.
The share of loans to refinance an existing loan eased to 31.2% in the week ended October 27 from 31.4% in the week ended October 20. This is down sharply from roughly 50% when the Fed began raising its fed funds rate target in March 2022. The share of adjustable-rate loans rose to 10.7% from 9.5% in the previous week. It was the highest level since November 2022.
The average size of a mortgage loan dropped 1.7% (-0.5% y/y) to $356,100 in the week ended October 27, from $362,100 in the week ended October 20. The average size of a loan to purchase a home eased 0.7% (+3.0% y/y) $407,800 from $410,700 the week prior, while the average size of a loan to refinance declined 5.6% (-8.0% y/y) to $241,700 from $256,100.
The Mortgage Bankers Association Survey covers 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 SURVEYS database.
Kathleen Stephansen, CBE
AuthorMore in Author Profile »Kathleen Stephansen is a Senior Economist for Haver Analytics and an Independent Trustee for the EQAT/VIP/1290 Trust Funds, encompassing the US mutual funds sponsored by the Equitable Life Insurance Company. She is a former Chief Economist of Huawei Technologies USA, Senior Economic Advisor to the Boston Consulting Group, Chief Economist of the American International Group (AIG) and AIG Asset Management’s Senior Strategist and Global Head of Sovereign Research. Prior to joining AIG in 2010, Kathleen held various positions as Chief Economist or Head of Global Research at Aladdin Capital Holdings, Credit Suisse and Donaldson, Lufkin and Jenrette Securities Corporation.
Kathleen serves on the boards of the Global Interdependence Center (GIC), as Vice-Chair of the GIC College of Central Bankers, is the Treasurer for Economists for Peace and Security (EPS) and is a former board member of the National Association of Business Economics (NABE). She is a member of Chatham House and the Economic Club of New York. She holds an undergraduate degree in economics from the Universite Catholique de Louvain and graduate degrees in economics from the University of New Hampshire (MA) and the London School of Economics (PhD abd).
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