Recent Updates

  • Kosovo: Import Price Index (Q4)
  • Estonia: PPI, Export & Import Price Index (Feb)
  • Georgia: PPI (Feb)
  • Germany: PPI (Feb)
  • Japan: Population Estimates (Mar), Government Bond Trading Volume by Category of Investors, Machine Tool Orders, Convenience Store Sales (Feb)
  • China: Local Government Debt (Feb)
  • Australia: Leading Indicator of Employment (Mar), ADI Property
  • more updates...

Economy in Brief

Mortgage Applications Recovered
by Tom Moeller September 6, 2006

The total number of mortgage applications recovered 1.8% last week, according to the Mortgage Bankers Association, after a 0.9% decline at the end of August. The gain lifted the opening September level 1.5% versus the August average which rose 2.9% from July.

A 3.7% w/w increase in purchase applications followed several weeks of decline and lifted applications 1.7% above the August average which fell 3.5% from July.

During the last ten years there has been a 58% correlation between the y/y change in purchase applications and the change in new plus existing single family home sales.

Applications to refinance slipped 0.9%.

The effective interest rate on a conventional 30-year mortgage fell to 6.53% from 6.60% the prior week. The peak for 30 year financing was 7.08% late in June. The rate on 15-year financing also fell to 6.25% and the peak rate was 6.75%. Interest rates on 15 and 30 year mortgages are closely correlated (>90%) with the rate on 10 year Treasury securities.

During the last ten years there has been a (negative) 79% correlation between the level of applications for purchase and the effective interest rate on a 30-year mortgage.

The Mortgage Bankers Association surveys between 20 to 35 of the top lenders in the U.S. housing industry to derive its refinance, purchase and market indexes. The weekly survey accounts for more than 40% of all applications processed each week by mortgage lenders. Visit the Mortgage Bankers Association site here.

MBA Mortgage Applications (3/16/90=100) 09/01/06 08/25/06 Y/Y 2005 2004 2003
Total Market Index 566.3 556.5 -26.6% 708.6 735.1 1,067.9
  Purchase 389.7 375.9 -21.9% 470.9 454.5 395.1
  Refinancing 1,594.7 1,609.2 -26.4% 2,092.3 2,366.8 4,981.8
large image