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Economy in Brief

U.S. Mortgage Applications Fell Across Markets
by Kathleen Stephansen, CBE  November 3, 2021

• Purchase and refinancing loan applications declined.

• 30-year mortgage rates declined from a multi-month high.

• Purchase loan size remains high.

The Mortgage Bankers Association's Loan Applications Index dropped 3.3% (-25.6% y/y) in the week ended October 29, following a rise of 0.3% (-20.1% y/y) in the week ended October 22. Mortgage applications for purchase declined 1.6% (-10.0% y/y) following a rise of 3.5% (-9.7% y/y) the week prior. Applications for refinancing fell 4.3% (-33.0% y/y) after a 1.6% fall (-25.5% y/y) the week prior.

The share of applications for refinancing edged down to 61.9% in the week of October 29 from 62.2% the week before. The adjustable-rate mortgage (ARM) share of activity edged up to 3.20% from 3.10% the week prior.

The effective interest rate on a 30-year mortgage declined to 3.34% in the week ended October 29 from 3.40% the week prior, which was the highest level since the first week in April. The effective 15-year rate edged down to 2.65% from 2.67% the prior week. The effective rate for a 30-year Jumbo mortgage loan was 3.37%, down from 3.43% the prior week, while the rate on a 5-year adjustable-rate loan softened to 2.92% from 2.94% in the week ending October 22. These last series date back only to January 2011, while the others begin in January 1990.

Applications for fixed-rate loans dropped 3.3% (-26.4%) in the week ended October 29, after a 0.5% rise (-20.9% y/y) in the week ended October 22. Applications for adjustable-rate mortgages declined 2.5% (+12.1% y/y) following a decline of 5.0% (+16.3% y/y) the prior week, making it the fifth straight weekly decline.

The average size of mortgage loans was $335,900 in the week of October 29, up from $334,600 the week prior. The size of loans for purchase was $407,600, down from $409,500 the week before. The average size of refinance loans rose to $291,700 in the week ending October 29, up from $289,200 in the week of October 22.

This 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) 10/29/21 10/22/21 10/15/21 Y/Y 2020 2019 2018
Total Market Index -3.3 0.3 -6.3 -25.6 63.0 32.4 -10.4
  Purchase -1.6 3.5 -4.9 -10.0 11.4 6.6 2.1
  Refinancing -4.3 -1.6 -7.1 -33.0 111.0 71.1 -24.3
30-Year Effective Mortgage Interest Rate (%) 3.34 3.40 3.33 3.11

(Oct '20)

3.40 4.34 4.94
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