U.S. Mortgage Applications Surged in the January 10 Week
Summary
- Applications to purchase and to refinance loans jumped.
- Rates on 30-year fixed-rate loans rose moderately.
- Average loan size rose modestly in latest week.
Mortgage applications jumped 33.3% (6.6% y/y) in the week ended January 10, after a decline of 3.7% (-11.6% y/y) in the week ended January 3, and ending a streak of four consecutive weekly declines. Applications for loans to purchase a house jumped 26.9% (-0.1% y/y) in the week ended January 10, following a drop of 6.6% (-14.1% y/y) in the week ended January 3. Applications to refinance a loan surged 43.5% (22.2% y/y) in the latest week, after a rise of 1.5% (-5.7% y/y) in the prior week. These data are from the Mortgage Bankers Association's (MBA) Weekly Mortgage Applications Survey and the amounts quoted are seasonally adjusted.
The effective interest rate on a 30-year fixed rate loan was 7.28% in the week ended January 10, up 10bps from 7.18% in the week ended January 3. The effective rate on a 15-year fixed rate mortgage inched down 1bp to 6.61% in the week ended January 10 from 6.62% in the week ended January 3. The rate on a 30-year jumbo loan rose 2bps to 7.22% in the latest week from 7.20% in the January 3 week. The rate on a 5-year ARM rose 31bps to 6.38% from 6.07% in the week ended January 3.
The share of applications to refinance an existing mortgage was 42.7% in the week ended January 10, up from 40.8% in the week ended January 3. The share of applications for ARMs was 5.0% in the latest week, up from 4.7% in the January 3 week.
The average loan size in the January 10 week was $367,100, up 2.1% (1.7% y/y) from $359,500 in the January 3 week. The average size of an application for a loan to purchase a house was up 1.3% (1.1% y/y) to $419,600 in the week ended January 10 from $414,400 in the week ended January 3. The average size of an application to refinance an existing loan rose by 6.0% (9.6% y/y) to $296,800 in the week ended January 10 from $279,900 in the week ended January 3.
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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