• Mortgage applications rose 6.8% in week ending August 7.

• A 9.1% increase in refinance applications led the increase. Purchase applications were up 2.0%.

• Major mortgage interest rates fell to new lows for the history of the survey (January 1990).

The Mortgage Bankers Association reported that its total Mortgage Applications Index increased 6.8% w/w (+37.1% y/y) in the week ended August 7 after having declined in each of the previous two weeks. Applications for loans to purchase a home rose 2.0% w/w (+21.8% y/y) following a 1.8% w/w decline the previous week. Loan applications for refinancing jumped up 9.1% w/w (+46.7% y/y) after having fallen 6.8% w/w the previous week. The refinance share of mortgage activity increased to 65.7% of total applications, the highest since May, from 63.9% the previous week. The adjustable-rate mortgage (ARM) share of activity decreased to 2.7% of total applications.

All three major mortgage interest rates fell last week to new lows for the series, which dates back to January 1990. The effective interest rate on a 15-year fixed-rate mortgage declined to 2.76% from 2.83% the previous week. The 30-year fixed rate fell to 3.16% from 3.25% the previous week. The 30-year jumbo rate slumped 12 basis points to 3.49%. In contrast, the 5-year adjustable rate increased to 3.11% from 3.07% the previous week.

The average mortgage loan size was unchanged at $326,300 (-5.5% y/y), down meaningfully from the early March high of $367,900. For purchases the average loan size slipped to $364,300 (+12.6% y/y) from $366,500 while the average refinancing loan edged up to $306,500 (-14.6% y/y) from $303,700.

With fixed mortgage interest rates having fallen more than adjustable rates, applications for fixed-rate loans were up 41.9% y/y while applications for adjustable rate mortgages were down 38.6% 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.