U.S. Mortgage Applications Rose in Early April
Summary
- Mortgage applications rose in the week ending April 7.
- Applications for purchase a loan rose strongly, while applications to refinancing a loan were little changed.
- The effective rates on fixed-rate loans and on ARMs all eased in the latest week.
Mortgage loan applications rose 5.3% (-41.7% y/y) in the week ended April 7, following a decline of 4.1% (-45.3% y/y) in the week ended March 31, and resuming what had been four consecutive weekly increases prior to the weekly decline at the end of March. Even with the latest weekly increase, applications remain near the lowest level since early 1997. These data are from the Mortgage Bankers Association's (MBA) Weekly Mortgage Applications Survey.
Purchase loan applications rose 7.8% (-31.4% y/y) in the week ended April 7, after a decrease of 3.5% (-35.5% y/y) in the week ended March 31. Applications to refinance an existing loan were little changed, advancing 0.1% (-56.9% y/y), and following a drop of 5.4% (-59.1% y/y) the week prior.
The percentage of applications for refinancing an existing loan eased to 27.0% in the week ended April 7, down from 28.6% in the week ended March 31. The percentage of applications for an ARM loan fell to 6.0% from 7.2% in the prior week. The percentage of applications had not been this low since the week ended March 11, 2022.
The effective interest rate on a 30-year fixed-rate loan eased to 6.46% in the week ended April 7, down from 6.57% in the week ended March. This compares to a 7.02% high at the beginning of March. The effective rate on 15-year fixed-rate mortgages decreased to 5.92% in the week ended April 7 from 6.11% in the prior week. The rate on 30-year Jumbo loans dropped to 6.38% from 6.50% the prior week. The rate on a 5-year ARM eased to 5.84% from 5.98% the prior week.
The average loan size rose 1.7% (-1.1% y/y) to $387,700 in the week ended April 7. The series high of $401,900 was reached in the week ended May 6, 2022. The average size of a purchase loan rose 0.9% (-4.7% y/y) in the latest week to $431,900. The average loan size to refinance an existing mortgage rose 1.4% (-7.2% y/y) to $267,700.
The Mortgage Bankers 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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