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Economy in Brief
UK Consumer Sentiment Hits Lowest Reading since 1996
(when the GFK survey began; also lowest reading 'ever')
Of these 13 readings eight of them declined on the month in May three of them improved and two of them were unchanged...
U.S. Existing Home Sales Continue to Fall in April as Houses Become Less Affordable
The combination of soaring home prices across the nation and rising interest rates is making homes less affordable...
U.S. Index of Leading Indicators Fell in April
Five of the index's components fell in April, one was unchanged and four increased...
U.S. Unemployment Claims Rose in the Latest Week
The state insured rates of unemployment in regular programs vary widely...
CBI Gauge in the UK Continues to Be Upbeat
The global economy has a lot of challenges...
Viewpoints
Commentaries are the opinions of the author and do not reflect the views of Haver Analytics.
Profits and Margins Plunge In Q1: Expect More Margin Contraction As Fed Squeezes Inflation
The Many Links of Inflation Cycle: Hard Landing Is Needed to Crack Them
Peak Inflation and Fed Policy: A Relationship which Should Worry the Fed and Scare Investors
Why Have the Yields on TIPS Been Negative in the Past Two Years?
by Tom Moeller September 5, 2012
It seems odd, but fewer mortgage applications are accompanying falling interest rates. The Mortgage Bankers Association index of total mortgage applications fell another 2.5% last week (+27.5% y/y), the fifth straight week of sharp decline. Applications have fallen 18.6% from the June high. Applications to refinance fell 3.0% w/w and by nearly one quarter during the last five weeks. Home purchase applications slipped 0.8% last week and they're down 13.2% from the June high. Applications for fixed interest rate loans have risen by nearly one-third y/y as lower mortgage rates are locked in. Conversely, variable rate loan applications have fallen 19.5% y/y.
The effective rate on fixed-interest, conventional 15-year mortgages fell w/w to 3.19% compared to 3.47% in January. The effective rate on a 30-year fixed rate loan fell back to 3.89%. On a 30-year Jumbo loan, the effective rate declined to 4.14%. 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 2.77% 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.
MBA Mortgage Applications (SA, 3/16/90=100) | 08/31/12 | 08/24/12 | 08/17/12 | Y/Y% | 2011 | 2010 | 2009 |
---|---|---|---|---|---|---|---|
Total Market Index | 766.1 | 786.1 | 821.3 | 27.5 | 572.3 | 659.3 | 736.4 |
Purchase | 178.4 | 179.9 | 177.4 | 11.8 | 182.6 | 199.8 | 263.5 |
Refinancing | 4,216.0 | 4,346.2 | 4,609.9 | 33.0 | 2,858.4 | 3,348.1 | 3,509.2 |
15-Year Mortgage Effective Interest Rate (%) | 3.19 | 3.23 | 3.26 | 3.76 (8/11) |
3.97 | 4.39 | 4.85 |