U.S. Mortgage Loan Applications Fall in the October 4 Week
Summary
- Loan applications to purchase a house dropped in the latest week.
- Interest rates on all loans rose in the latest week.
- Average loan size declined, while the size of loans to purchase rose modestly.
Mortgage loan applications dropped 5.1% (+54.8% y/y) in the week ended October 4, after a decline of 1.3% (+64.0% y/y) in the week ended September 27. Applications for loans to purchase a house eased 0.1% (+8.5% y/y) in the week ended October 4, after a 0.7% (+9.3% y/y) rise in the prior week, while applications to refinance an existing mortgage fell 9.3% (+158.5% y/y) following a decline of 2.9% (+185.9% y/y) in the September 27 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 6.54% in the week ended October 4, up 22 bps from 6.32% in the September 27 week. A recent high of 6.59% was reached in the week ended August 30 but remains well below the 8.12% rate of the week of October 20, 2023. The effective rate on a 15-year fixed rate mortgage was 5.88% in the October 4 week, up 21 bps from the 5.67% rate in the September 27 week, and the 5.60% during the two prior weeks; those 5.60% rates were the lowest since 5.52% in the September 9, 2022 week. The rate on 30-year Jumbo loans rose 17 bps to 6.78% in the October 4 week, up from 6.61% in the week ended September 27, and the rate on 5-year ARM loans rose 21 bps to 6.28% in the latest week from 6.07%.
The share of loan applications to refinance an existing mortgage was 52.4% in the week ended October 4, down from 54.9% in the September 27 week. The share of applications for ARMs was 5.9% in the latest week, up marginally from 5.8% in the September 27 week.
The average size of a mortgage loan application was $402,900 in the week ended October 4, down 1.4% w/w from $408,600 in the September 27 week. The average size of a loan to purchase a house rose 1.1% to $452,600 in the October 4 week, from $447,800 the week before. The average size of a loan to refinance fell 5.0% to $357,600 in the October 4 week from $376,300 in the September 27 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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