U.S. Mortgage Applications Retrenched in the January 24 Week
Summary
- Both purchase and refinancing loan applications fell in the latest week.
- Effective interest rates on 30-year fixed-rate loans held steady at 7.20%.
- Average loan size rose to the highest since the November 1 week.
Mortgage applications dropped 2.0% (+8.6% y/y) in the week ending January 24 after edging up 0.1% w/w (2.9% y/y) in the week ending January 17, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey. The latest reading follows a six-week high in the index level. Applications for loans to purchase a house fell 0.4% (+5.1% y/y) in the January 24 week, after a rise of 0.6% (-6.5% y/y) in the January 17 week. Applications for loan refinancing fell 6.8% (+16.9% y/y) in the latest week, following a drop of 2.9% (+27.5% y/y) in the January 17 week.
The effective interest rate on a 30-year fixed-rate loan held steady at 7.20% in the week ending January 24 from the prior week when it posted the first w/w fall since the December 6 week. The rate on 15-year fixed-rate mortgages fell 5bps to 6.56% in the January 24 week, from 6.61% in the January 17 week. The rate on 30-year jumbo loans edged up 5bps to 7.18% in the latest week, from 7.13% in the January 17 week, while the rate on a 5-year ARM also rose 5bps to 6.67% in the week ended January 24 from 6.62% in the January 17 week.
The share of applications for refinancing an existing loan fell to 37.1% of total applications in the week ending January 24 from 40.4% in the week ending January 17, registering the lowest share since the July 5, 2024, week. Meanwhile, the adjustable-rate mortgage (ARM) share of activity rose to 5.8% in the latest week from 5.5% in the January 17 week, the highest since late November.
The average size of a mortgage loan increased 2.3% w/w (-0.6% y/y) to $382,300 in the week ended January 24 up from $373,800 in the January 17 week, reaching the highest level since the November 1 week. The average size of a purchase loan rose 1.1% (-1.7% y/y) to $436,500 in the January 24 week from $431,600 in the January 17 week, the highest since the November 22 week. The average size of a loan to refinance a mortgage rose 0.8% (7.3% y/y) to $290,500 in the latest week from $288,300 in the January 17 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).
More Economy in Brief
Global