U.S. Mortgage Applications Edge Up in November 8 Week
by:Sandy Batten
|in:Economy in Brief
Summary
- Applications edged up 0.5% w/w after having declined for six consecutive weeks.
- Refinancing applications continued to fall while purchase applications rebounded.
- Mortgage interest rates rose slightly.
Mortgage loan applications edged up 0.5% w/w (12.8% y/y) in the week of November 8 following a 10.8% weekly decline in the previous week. This was the first weekly advance in the past seven weeks. Applications for loans to purchase a house rebounded 1.9% w/w (0.1% y/y) after a 5.1% w/w drop in the previous week, while applications to refinance an existing mortgage fell 1.5% w/w (+42.8% y/y), their seventh consecutive weekly decline, on top of an 18.5% w/w plunge in the previous week. These data are from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey.
Mortgage interest rates in general rose further. The effective interest rate on a 30-year fixed-rate mortgage inched up further to 7.03% from 7.01% in the week ended November 1. This rate has risen 74bps since its recent low in the week ended September 20. The effective rate on a 15-year fixed rate mortgage was 6.37% in the latest week, up 2bps from the previous week down and up 77bps from the recent low in the week of September 20. The rate on 30-year Jumbo loans slipped 3bps to 7.14% after having jumped 26bps to 7.17% in the week ended November 1. The rate on 5-year ARM loans fell 7bps to 6.29% in the latest week from 6.36% in the prior week.
The share of loan applications to refinance an existing mortgage was unchanged at 39.9% in the week ended November 8, the lowest since late July. The share of applications for ARMs fell to 6.5% from 7.0% in the previous week.
The average size of a mortgage loan application fell 1.9% w/w to $379,300 in the week ended November 8. This was the smallest loan size since the week ended August 30. The average size of a loan to purchase a house fell 1.9% w/w to $436,900, and the average size of a loan to refinance dropped 1.8% w/w to $292,700 in the November 8 week.
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.
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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