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Economy in Brief
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...
U.S. Housing Starts Dip in April but Remain Elevated
The pattern of housing construction activity seems to be shifting toward multifamily...
U.S. Mortgage Applications Continued to Slide Amid Higher Rates
The biggest declines have been in refinancing activity, while applications for purchase are just starting to crack...
UK Inflation Jumps
Inflation is at the highest rate since the series began in January of 1989...
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 & 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 Carol Stone, CBE July 15, 2020
• 15-year fixed rate mortgage rate eased to another record low.
• Home purchase apps fall back in the week.
The Mortgage Bankers Association reported that its total Mortgage Applications Index increased 5.1% (61.1% y/y) during the week ending July 10, following the previous week's 2.2% rise. The latest gain was all in applications to refinance, which bounced 11.9% after inching up just 0.4% in the July 3 week and falling in the two prior weeks. Applications to purchase a home actually backtracked 6.1%, more than reversing their 5.3% gain the week before.
The effective interest rate on a 15-year fixed-rate mortgage edged down somewhat more to 2.78% after its already-record low of 2.85% last week. Thirty-year fixed rates also decreased to a new record low of 3.29% from the prior week's 3.36%. Thirty-year jumbo rates eased to 3.61% from 3.62%. Five-year adjustable rates decreased to 3.00% from 3.01%, still the lowest level since September 2016.
The average mortgage loan size increased w/w to $330,600 (+2.2% y/y) from the previous week's $330,100, but remained down versus the early March high of $367,900 and an all-time high of $381,700 in March 2019. For purchases, the average loan size fell to $357,000 (+10.2% y/y) from the prior week's record $365,700; the average refinancing loan size increased to $315,900 (-2.1% y/y) from $306,500.
With interest rates low, applications for fixed-rate loans increased 66.3% y/y while adjustable-rate mortgage loans declined 0.3% y/y.
The survey covers over 75% 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.
MBA Mortgage Applications (%, SA) | 07/10/20 | 07/03/20 | 06/26/20 | Y/Y | 2019 | 2018 | 2017 |
---|---|---|---|---|---|---|---|
Total Market Index | 5.1 | 2.2 | -1.8 | 61.1 | 32.4 | -10.4 | -17.8 |
Purchase | -6.1 | 5.3 | -1.3 | 15.5 | 6.6 | 2.1 | 5.6 |
Refinancing | 11.9 | 0.4 | -2.2 | 106.6 | 71.1 | -24.3 | -34.0 |
15-Year Effective Mortgage Interest Rate (%) | 2.78 | 2.85 | 2.90 |
3.54 |
3.71 | 4.35 | 3.59 |