Global| Dec 09 2020U.S. Mortgage Applications Ease As Purchase Applications Fall
by:Tom Moeller
|in:Economy in Brief
Summary
• Mortgage rates decline to another record low. • Refinancing applications rise moderately. The Mortgage Bankers Association Mortgage Loan Applications Index declined 1.2% in the week ended December 4 (+59.4% y/y) and added to the [...]
• Mortgage rates decline to another record low.
• Refinancing applications rise moderately.
The Mortgage Bankers Association Mortgage Loan Applications Index declined 1.2% in the week ended December 4 (+59.4% y/y) and added to the prior week's 0.6% slip. Fewer purchase applications led the decline with a 5.0% fall (+21.4% y/y) after rising 9.0% in the prior week. Refinancing applications increased 1.8% (+89.1% y/y) following a 4.6% drop. Refinancing share of total applications rose to 72.0% from 69.5% the previous week. The share of applications for mortgage loans with adjustable rates decreased to 1.7% from 1.8% in the last week of November.
The effective interest rate on a 30-year mortgage edged down to a record low of 3.00% from 3.01% in the week earlier. The 15-year fixed-rate loan held steady at 2.60%, and the rate on a 5-year adjustable rate loan fell 2.75%. These series begin in January 1990. The effective rate for a Jumbo mortgage edged slightly higher to 3.28% from 3.27% in the prior week.
The average mortgage loan size fell to $317,800 (+1.2% y/y) from $323,300 in the prior week. The average size of a purchase loan declined to $366,100 (+12.6% y/y) from $375,200. The average size of a refinanced loan eased to $299,000 (-2.8% y/y) from $300,500.
Applications for fixed-rate loans declined 1.0% (+65.0% y/y) from $323,300 and applications for adjustable-rate mortgages dropped 8.7% (-46.1% y/y).
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) | 12/4/20 | 11/27/20 | 11/20/20 | Y/Y | 2019 | 2018 | 2017 |
|---|---|---|---|---|---|---|---|
| Total Market Index | -1.2 | -0.6 | 3.9 | 59.4 | 32.4 | -10.4 | -17.8 |
| Purchase | -5.0 | 9.0 | 3.5 | 21.4 | 6.6 | 2.1 | 5.6 |
| Refinancing | 1.8 | -4.6 | 4.5 | 89.1 | 71.1 | -24.3 | -34.0 |
| 30-Year Effective Mortgage Interest Rate (%) | 3.00 | 3.01 | 3.02 | 4.07
(Dec '19) |
4.34 | 4.94 | 4.32 |
Tom Moeller
AuthorMore in Author Profile »Prior to joining Haver Analytics in 2000, Mr. Moeller worked as the Economist at Chancellor Capital Management from 1985 to 1999. There, he developed comprehensive economic forecasts and interpreted economic data for equity and fixed income portfolio managers. Also at Chancellor, Mr. Moeller worked as an equity analyst and was responsible for researching and rating companies in the economically sensitive automobile and housing industries for investment in Chancellor’s equity portfolio. Prior to joining Chancellor, Mr. Moeller was an Economist at Citibank from 1979 to 1984. He also analyzed pricing behavior in the metals industry for the Council on Wage and Price Stability in Washington, D.C. In 1999, Mr. Moeller received the award for most accurate forecast from the Forecasters' Club of New York. From 1990 to 1992 he was President of the New York Association for Business Economists. Mr. Moeller earned an M.B.A. in Finance from Fordham University, where he graduated in 1987. He holds a Bachelor of Arts in Economics from George Washington University.
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