Recent Updates
- Japan: NCI Economic Activity Index (Aug)
- US: NAHB/Wells Fargo Housing Market Index (Aug)
- Canada: Wholesale trade, MSIO (June)
- Pakistan: Foreign Currency Deposits and Utilization (JUL)
- US: Empire State Mfg Survey (Aug)
- more updates...
Economy in Brief
U.S. Housing Affordability Declines Further in June
The NAR Fixed Rate Mortgage Housing Affordability Index fell 3.6% in June...
EMU Output Makes Solid Gain in June
The European Monetary Union posted a 0.7% increase for industrial output in June...
U.S. Producer Prices Fall During July; Core Increase Weakens
The Producer Price Index for Final Demand fell 0.5% during July...
U.S. Unemployment Claims Continue on an Uptrend
Initial claims for unemployment insurance filed in the week ended August 6 rose 14,000 to 262,000...
RICS Survey Points to More U.K. Housing Sector Weakness
The survey of housing market conditions in the U.K. continues to show strength in prices versus weakness...
Viewpoints
Commentaries are the opinions of the author and do not reflect the views of Haver Analytics.
by Tom Moeller February 14, 2007
The total number of mortgage applications increased 1.5% last week after a slight 0.2% decline to start the month, according to the Mortgage Bankers Association.
The gain was wholly due to a 4.5% rise in applications to refinance after the 0.2% uptick during the prior week.
Purchase applications fell 1.0% after a 0.8% decline during the prior week.
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.
The effective interest rate on a conventional 30-year mortgage ticked up two basis points to 6.46%. Rates averaged 6.40% last month and 6.28% in December. The peak for 30 year financing was 7.08% late in June. Rates for 15-year financing dipped slightly to 6.22%. 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 covers roughly 50% of all U.S. residential mortgage applications processed each week by mortgage banks, commercial banks and thrifts. Visit the Mortgage Bankers Association site here.
Monetary Policy Inertia and Recent Fed Actions from the Federal Reserve Bank of San Francisco is available here.
MBA Mortgage Applications (3/16/90=100) | 02/09/07 | 02/02/07 | Y/Y | 2006 | 2005 | 2004 |
---|---|---|---|---|---|---|
Total Market Index | 639.8 | 630.1 | 11.4% | 584.2 | 708.6 | 735.1 |
Purchase | 400.7 | 404.7 | 2.3% | 406.9 | 470.9 | 454.5 |
Refinancing | 2,031.7 | 1,943.4 | 24.1% | 1,634.0 | 2,092.3 | 2,366.8 |