U.S. Mortgage Applications Fell in the Latest Week
Summary
- Mortgage applications fell for the third consecutive week.
- Purchase & loan refinancing applications refinancing slip.
- Rates on 30-year fixed-rate mortgage loans decline slightly.
Mortgage applications fell 0.6% (-10.2% y/y) in the week ended March 29 following a drop of 0.7% (-13.4% y/y) in the prior week, marking the third consecutive weekly decline. Applications for loans to purchase a home eased 0.1% (-12.6% y/y) in the latest week after a 0.2% (-15.6% y/y) decline in the prior week. Applications to refinance a loan declined 1.6% (-5.0% y/y) in the week of March 29 following a similar 1.6% (-8.6% y/y) drop one week earlier. These data are from the Mortgage Bankers Association's (MBA) Weekly Mortgage Applications Survey.
The effective interest rate on a 30-year fixed-rate loan slipped 2bps to 7.08% in the week ended March 29 from 7.10% in the prior week. It compared to a high of 8.12% in mid-October of last year. The rate on 15-year fixed-rate mortgages dropped 16 bps to 6.49% in the latest week, from 6.65% in the prior week. The rate on 30-year Jumbo loans fell 2 bps to 7.23% last week from 7.25% the week prior, while the rate on the 5-year ARM rose 11bps to 6.62% from 6.51%. These rates were below the 7.31% high in the last week of October but above the recent low of 5.93% in the last week of December.
The share of applications for refinancing an existing loan fell to 30.3% in the week ended March 29, from 30.8% in the week ended March 22. That compared to a high of 39.7% in mid-December. The percentage of applications that were ARMs remained unchanged at 7.0%. This recent low of 5.4% was reached in early January.
The average loan size rose 2.2% (3.8% y/y) to $395,500 in the week ended March 29, from $387,000 in the prior week. The average size of a purchase loan rose 2.5% (5.8% y/y) to $453,000 in the latest week from $441,800 in the prior week. The average loan size to refinance a mortgage eased 0.2% (-0.2% y/y) to $263,500 in the week ended March 29, from $264,000 in the prior 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.
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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