U.S. Mortgage Loan Applications Dropped in the November 1 Week
Summary
- Loan applications to purchase and to refinance a house fell in the latest week.
- The 30-year fixed-rate mortgage continued to rise in the latest week.
- Average loan size rose slightly.
Mortgage loan applications dropped 10.8% (+15.4% y/y) in the week ended November 1st after easing 0.1% (+32.6% y/y) in the week ended October 25, making it the sixth consecutive weekly decline. Applications for loans to purchase a house fell 5.1% (+1.4% y/y) in the week ended November 1st after rising 5.0% (+10.1% y/y) in the week ended October 25, while applications to refinance an existing mortgage plummeted 18.5% (47.9% y/y) following a drop of 6.3% (+84.4% y/y) in the prior week. These data are from the Mortgage Bankers Association's (MBA) Weekly Mortgage Applications Survey.
The effective interest rate on a 30-year fixed-rate mortgage was 7.01% in the week ended November 1st, up 8 bps from the 6.93% rate in the week ended October 25, and up 72 bps from the recent low of 6.29% reached on the week ended September 20. The effective rate on a 15-year fixed rate mortgage was 6.35% in the latest week, down 11 bps from the 6.46% rate in the October 25 week. The rate on 30-year Jumbo loans rose 26 bps to 7.17% in the week ended November 1st from 6.91% in the October 25 week, while the rate on 5-year ARM loans fell 5 bps to 6.36% in the latest week from 6.41% in the prior week.
The share of loan applications to refinance an existing mortgage was 39.9% in the week ended November 1st, down from 43.1% in the week ended October 25. The share of applications for ARMs was 7.0% in the latest week, up from 6.4% in the prior week.
The average size of a mortgage loan application was $386,700 in the week ended November 1st, up 0.3% w/w from $385,600 in the week ended October 25. The average size of a loan to purchase a house fell 0.4% w/w to $445,500 in the November 1st week from $447,200 in the October 25 week. The average size of a loan to refinance dropped 2.0% w/w to $298,200 in the November 1st week from $304,200 in the October 25 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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