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Economy in Brief

U.S. Mortgage Applications Continue To Decline
by Tom Moeller  August 29, 2012

The Mortgage Bankers Association index of total mortgage applications declined 4.3% last week (+24.4% y/y), the fourth straight week of sharp decline. Applications have fallen 17.2% from the June high. Applications to refinance fell 5.7% w/w and dropped 20.3% during the last four weeks. Conversely, home purchase applications rose 1.4% last week. Applications for fixed interest rate loans fell 4.5% w/w for the fourth straight week of sharp decline. Variable rate loan applications have fallen roughly one-third since their recent high.

The effective rate on fixed-interest, conventional 15-year mortgages fell w/w to 3.23% and retraced their earlier rise. The effective rate on a 30-year fixed rate loan fell back to 3.92%. On a 30-year Jumbo loan, the effective rate declined to 4.16%. Though it's narrowed slightly of late, the spread between 15- and 30-year loan rates continued wide by historical standards. The effective interest rate on an adjustable 5-year mortgage slipped to 2.81% and was down from its 3.93% high during February of last year.

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. The figures for weekly mortgage applications are available in Haver's SURVEYW database.

A New Look at Second Liens from the Federal Reserve Bank of New York is available here.

 

MBA Mortgage Applications (SA, 3/16/90=100) 08/24/12 08/17/12 08/10/12 Y/Y% 2011 2010 2009
Total Market Index 786.1 821.3 886.8 24.4 572.3 659.3 736.4
 Purchase 179.9 177.4 175.9 12.9 182.6 199.8 263.5
 Refinancing 4,346.2 4,609.9 5,077.3 28.5 2,858.4 3,348.1 3,509.2
15-Year Mortgage Effective Interest Rate (%) 3.23 3.26 3.22 3.76
(8/11)
3.97 4.39 4.85
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