Global| Apr 21 2021U.S. Mortgage Applications Rebound
by:Tom Moeller
|in:Economy in Brief
Summary
• Refinancing & purchase applications jump. • Mortgage interest rates ease again. The Mortgage Bankers Association Mortgage Loan Applications Index increased 8.6% (-5.7% y/y) in the week ended April 16, following six consecutive [...]
• Refinancing & purchase applications jump.
• Mortgage interest rates ease again.
The Mortgage Bankers Association Mortgage Loan Applications Index increased 8.6% (-5.7% y/y) in the week ended April 16, following six consecutive weekly declines. Despite the latest increase, the level of applications has fallen slightly since the end of last month. Applications for refinancing increased 10.4% (-23.5% y/y) and also followed six weeks of decline. Applications to purchase a home improved 5.7% (58.5% y/y) after falling for three straight weeks.
The refinance share of mortgage activity rose slightly to 60.0% of total applications. This share has declined from a peak of 74.8% in early January. The adjustable rate mortgage (ARM) share of activity held steady at 3.6% last week.
Mortgage interest rates fell last week. The effective interest rate on a 30-year mortgage declined to 3.30% from 3.37% in the prior week but remained above the 2.96% rate at the beginning of the year. The effective 15-year rate eased to 2.75% from 2.78%, compared to 2.47% at the start of the year. The effective rate for a 30-year Jumbo mortgage eased to 3.42% after falling to 3.45% in the prior week. The rate on a five-year ARM rose to 2.87% from 2.74%.
The average mortgage loan size increased to $330,200 in the week ended April 16. The average size of a purchase loan edged increased to $406,100. The average size of a refinanced loan fell to $279,500.
Applications for fixed-rate loans rose 8.5% (-6.5% y/y) last week following six consecutive weekly declines. Applications for adjustable-rate mortgages increased 8.7% (22.6% y/y) last week after falling 6.3% 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) | 04/16/21 | 04/09/21 | 04/02/21 | Y/Y | 2020 | 2019 | 2018 |
|---|---|---|---|---|---|---|---|
| Total Market Index | 8.6 | -3.7 | -5.1 | -5.7 | 63.0 | 32.4 | -10.4 |
| Purchase | 5.7 | -1.4 | -4.6 | 58.5 | 11.4 | 6.6 | 2.1 |
| Refinancing | 10.4 | -5.0 | -5.3 | -23.5 | 111.0 | 71.1 | -24.3 |
| 30-Year Effective Mortgage Interest Rate (%) | 3.30 | 3.37 | 3.48 | 3.54
(Apr '20) |
3.40 | 4.34 | 4.94 |
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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