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Economy in Brief

U.S. Mortgage Applications Rise for a Second Week
by Carol Stone, CBE  November 23, 2022

• Loans to purchase and to refinance both had gains.

• Mortgage rates decline on fixed-rate loans, but rose slightly for ARMs.

Mortgage applications were up for a second consecutive week in the week ended November 18, rising 2.2% (-67.8% y/y) from the week before, when they rose 2.7%, according to the Mortgage Bankers Association survey. Applications for loans to purchase a home rose 2.8% last week (-41.0% y/y) after the prior week’s 4.4% increase. Applications for refinancing a loan increased 1.8% (-86.2% y/y) in the November 18 week, turning up from a 1.6% decrease the week before.

The share of applications for refinancing an existing loan was up slightly to 28.4% in the November 18 week from the prior week’s 27.6%. The latest week’s share did remain down from roundly 65% during the last weeks of 2021. The percentage that were ARM applications fell to 8.8% in the November 18 week from 10.6% the week before and was the smallest since the first week of September.

The effective rate on a 30-year fixed-rate loan eased to 6.87% in the latest week, down from 7.06% the week before; the latest is still up significantly from 3.39% in December of last year. The rate on 15-year fixed-rate mortgages was down 20 basis points to 6.25% from 6.45% the week before. The rate on 30-year Jumbo loans fell 18 basis points to 6.52% while that on a 5-year ARM rose to 6.05% from 5.97.

The average loan size increased to $363,300 (+5.3% y/y) in the November 18 week from $355,700 the week before. The series high of $401,900 was reached in the week ended May 6. The average size of a purchase loan was $429,000 (-1.7% y/y), up from $416,700. The average size of a loan to refinance a mortgage increased to $275,500 (-14.0% y/y) from $273,100.

The Mortgage Bankers Survey covers 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 SURVEYS database.

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