U.S. Mortgage Applications Ease Slightly; Average Rate Highest in More Than 20 Years
Summary
- Total application down 1.3%.
- Purchase applications down 1.9%.
- Effective rate on loans to purchase 7.61%, high since late 2000.
Mortgage applications decrease 1.3% in the week ended September 22 (-25.6% y/y) after increasing 5.4% the week before, according to the Mortgage Bankers Association Weekly Mortgage Applications Survey. Applications for loans to purchase a house eased 1.5% in the latest week after a 2.3% increase (-27.3% y/y) in the prior week, while applications to refinance a loan edged down 0.9% in the latest week (-21.4% y/y) after surging 13.2% in the September 15 week.
The effective interest rate on a 30-year fixed rate loan increased 9 basis points in the September 22 week to 7.61% after rising 4 basis points the week before to 7.52%. The latest rate, 7.61%, is the highest since 7.73% in the week of December 1, 2000, that is, almost 23 years ago. The effective rate on a 15-year fixed-rate loan was 7.02% in the latest week, up from 6.89% the week before. The rate on a 30-year Jumbo loan ticked up to 7.57% from 7.55%, and the rate on a 5-year adjustable rate loan rose to 7.06% from 6.83%.
The share of adjustable rate loans increased to 7.5% in the September 22 week from 7.2% the prior week. The share of loans to refinance an existing loan was 31.9% in the latest week, up modestly from 31.6%.
The average size of a mortgage loan was $364,900 in the latest week, marginally less than the prior week’s $365,600. The average size of a loan to purchase a house was $416,300, in the September 22 week, marginally less than $416,800 the week before, while the average size of a refinance loan was $255,100, up slightly from $254,600.
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.
Carol Stone, CBE
AuthorMore in Author Profile »Carol Stone, CBE came to Haver Analytics in 2003 following more than 35 years as a financial market economist at major Wall Street financial institutions, most especially Merrill Lynch and Nomura Securities. She has broad experience in analysis and forecasting of flow-of-funds accounts, the federal budget and Federal Reserve operations. At Nomura Securites, among other duties, she developed various indicator forecasting tools and edited a daily global publication produced in London and New York for readers in Tokyo. At Haver Analytics, Carol is a member of the Research Department, aiding database managers with research and documentation efforts, as well as posting commentary on select economic reports. In addition, she conducts Ways-of-the-World, a blog on economic issues for an Episcopal-Church-affiliated website, The Geranium Farm. During her career, Carol served as an officer of the Money Marketeers and the Downtown Economists Club. She has a PhD from NYU's Stern School of Business. She lives in Brooklyn, New York, and has a weekend home on Long Island.
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