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Economy in Brief

U.S. Mortgage Applications Recover As Interest Rates Decline
by Tom Moeller  April 10, 2013

The index of total mortgage applications from the Mortgage Banker Association increased 4.5% (21.7% y/y) last week and reversed the prior week's falloff. The rise was led by a 6.3% gain (28.5% y/y) in applications to refinance an existing loan. Home purchase mortgage applications reversed the prior week's increase with a 1.3% decline (+3.1% y/y). 

The effective rate on fixed-interest, conventional 15-year mortgages fell w/w to 3.00%, nearing December's weekly low of 2.89%. The effective rate on a 30-year fixed rate loan declined to 3.81% last week while the rate on a Jumbo 30-year loan slipped to 3.89%. Though it's recently narrowed, the spread between 15- and 30-year loan rates continued wide by historical standards. The effective interest rate on an adjustable 5-year mortgage was stable at 2.71%.

Applications for fixed interest rate loans rose by 23.0% y/y while adjustable rate loan applications fell 1.0% y/y. The average mortgage loan size was $221,300. The average size loan for home purchases was $262,500 last week while for refinancings it was $207,500.

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. 

The minutes to the latest FOMC meeting can be found here.

 

MBA Mortgage Applications (SA, 3/16/90=100) 04/05/13 03/29/13 03/22/13 Y/Y% 2012 2011 2010
Total Market Index 826.1 790.7 823.7 21.7 813.8 572.3 659.3
 Purchase 209.7 212.4 209.5 3.1 187.8 182.6 199.8
 Refinancing 4,453.9 4,189.0 4,436.6 28.5 4,505.0 2,858.4 3,348.1
15-Year Mortgage Effective Interest Rate (%) 3.00 3.08 3.13 3.43
(4/12)
3.25 3.97 4.39
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