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Economy in Brief

U.S. Mortgage Applications Edge Lower As Rates Ease
by Tom Moeller  December 22, 2021

• Purchase applications decline as refinancings increase.

• 30-year mortgage rate slips.

• Purchase loan size increases.

The Mortgage Bankers Association's Loan Applications Index slipped 0.6% (-33.9% y/y) in the week ended December 17 following a 4.0% decline in the prior week. Applications for loans to purchase a house fell 3.3% (-8.6% y/y) after a 0.7% rise. Applications for loans to refinance gained 2.2% (-42.4% y/y) following a 6.4% decline in the prior week.

The share of applications for refinancing rose to 65.2% last week, the most in three months. The adjustable-rate mortgage (ARM) share of activity held w/w at 4.3%.

The effective interest rate on a 30-year mortgage eased to 3.39% last week from 3.41% in the prior week. The effective rate on a 15-year rate mortgage edged up to 2.67%. The effective rate for a 30-year Jumbo mortgage loan eased to 3.39% last week, while the rate on a 5-year adjustable-rate loan increased to 2.90%. The last two series date back only to January 2011, while the others begin in January 1990.

Applications for fixed-rate loans slipped 0.6% (-34.9% y/y) last week, after a 4.4% decline in the prior week. Applications for adjustable-rate mortgages eased 0.2% (+18.2% y/y) following a 7.6% rise in the previous week.

The average size of a mortgage loans was $348,200 in the week ending December 17 compared to $342,100 in the week prior. The average size of loans for purchase was $416,200 in the latest week versus $406,800 one week earlier. The average size of refinanced loans rose to $311,900, up from $3000 in the prior week.

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) 12/17/21 12/10/21 12/03/21 Y/Y 2020 2019 2018
Total Market Index -0.6 -4.0 2.0 -33.9 63.0 32.4 -10.4
  Purchase -3.3 0.7 -5.0 -8.6 11.4 6.6 2.1
  Refinancing 2.2 -6.4 9.0 -42.4 111.0 71.1 -24.3
30-Year Effective Mortgage Interest Rate (%) 3.39 3.41 3.41 2.97

(Dec. '20)

3.40 4.34 4.94
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