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Economy in Brief

U.S. Mortgage Applications Downward Trend Remains In Place
by Tom Moeller  October 16, 2013

Mortgage bankers have seen their volume of business fall by roughly one-half during the last year. The Mortgage Bankers Association reported that despite the 1.7% w/w increase last week, their total mortgage market index was off 54.7% year-to-year. Applications to refinance an existing loan led the weekly gain with a 2.5% increase, but remained down by two-thirds versus October 2012. Home purchase mortgage applications slipped 0.7% last week (-5.6% y/y) and were 14.7% below the early-May peak.

The effective interest rate on a 15-year mortgage was stable last week at 3.60%, down 33 basis points from its early-September high. It remained up, however, versus the early-May low of 2.89%. The effective rate on a 30-year fixed rate loan also was stable at 4.55% last week while the rate on a Jumbo 30-year loan ticked up to 4.55%. The effective interest rate on an adjustable 5-year mortgage was stable w/w at 3.37% but remained up from its low of 2.59% at the beginning of May.

Applications for fixed interest rate loans fell by 53.8% y/y while adjustable rate loan applications declined 23.7% y/y. The average mortgage loan size slipped to $221,700. The average size loan for home purchases held steady at $264,400 last week while refinancings slipped to $199,200.

The survey covers over 75 percent of all U.S. retail residential mortgage applications, and has been conducted weekly since 1990.  Respondents include mortgage bankers, commercial banks and thrifts. The base period and value for all indexes is March 16, 1990=100. The figures for weekly mortgage applications and interest rates are available in Haver's SURVEYW database. 

Gauging the Momentum of the Labor Recovery from the Federal Reserve Bank of San Francisco can be found here.

MBA Mortgage Applications (SA, 3/16/90=100) 10/11/13 10/04/13 09/27/13 Y/Y% 2012 2011 2010
Total Market Index 457.1 455.9 450.2 -52.6 813.8 572.3 659.3
 Purchase 179.0 188.1 189.4 -10.9 187.8 182.6 199.8
 Refinancing 2,060.8 1,995.4 1,947.4 -62.2 4,505.0 2,858.4 3,348.1
15-Year Mortgage Effective Interest Rate (%) 3.60 3.60 3.63 3.01
(10/12)
3.25 3.97 4.39
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