Global| Jan 09 2013U.S. Mortgage Applications Surge In 2012
by:Tom Moeller
|in:Economy in Brief
Summary
Mortgage lenders were busy last year. The Mortgage Bankers Association index of total mortgage applications rose 42.2% in 2012 after declining during the prior two years. For last week, applications rose 11.7% (9.5% y/y) yet remained [...]
Mortgage lenders were busy last year. The Mortgage Bankers Association index of total mortgage applications rose 42.2% in 2012 after declining during the prior two years. For last week, applications rose 11.7% (9.5% y/y) yet remained 28.8% below the late-September peak. Applications to refinance an existing loan rose more than one-half from 2011 after two years of decline. For the week, refinancing applications rose 12.1% after three down weeks. Applications were one-third below the late-September high. Home purchase applications rose a modest 2.8% last year from 2011 after falling during five of the prior six years. For the week, applications rose for the first time in four weeks but remained roughly two-thirds below the late-2007 high.
Applications for fixed interest rate loans rose 44.4% during all of last year as borrowers locked in lower financing rates. Adjustable rate loan applications rose 7.0%. The average mortgage loan size was $220,500. The average for home purchases was $237,200 last year while for refinancings it was $216,100. The average size of a fixed rate loan was $206,100 last year and for variable rate loans it was $524,400.
The effective rate on fixed-interest, conventional 15-year mortgages averaged 3.25% last year versus 3.97 in 2011. Last week, the rate was 2.98% and remained down compared to 3.47% in January. The effective rate on a 30-year fixed rate was 3.72% last week while the rate on a Jumbo 30-year loan was 3.90%. Though it's recently narrowed, the spread between 15- and 30-year loan rates continued wide by historical standards. The effective interest rate on an adjustable 5-year mortgage was roughly stable at 2.78%, down from its 3.93% high during February of last year.
The Mortgage Bankers Association surveys between 20 to 35 of the top lenders in the U.S. housing industry to derive its refinance, purchase and market indexes. The weekly survey covers roughly 50% of all U.S. residential mortgage applications processed each week by mortgage banks, commercial banks and thrifts. The figures for weekly mortgage applications are available in Haver's SURVEYW database.
| MBA Mortgage Applications (SA, 3/16/90=100) | 01/04/13 | 12/28/12 | 12/21/12 | Y/Y% | 2012 | 2011 | 2010 |
|---|---|---|---|---|---|---|---|
| Total Market Index | 726.4 | 650.3 | 725.5 | 9.5 | 813.8 | 572.3 | 659.3 |
| Purchase | 185.7 | 169.5 | 189.4 | 4.9 | 187.8 | 182.6 | 199.8 |
| Refinancing | 3,956.6 | 3,528.3 | 3,937.4 | 11.1 | 4,505.0 | 2,858.4 | 3,348.1 |
| 15-Year Mortgage Effective Interest Rate (%) | 2.98 | 2.92 | 2.89 | 3.47 (1/12) |
3.25 | 3.97 | 4.39 |
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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