Global| Sep 10 2014U.S. Mortgage Loan Applications Decline To New Low
by:Tom Moeller
|in:Economy in Brief
Summary
The Mortgage Bankers Association reported that their total Mortgage Market Volume Index declined 7.2% last week (-15.0% y/y) after the prior week's 0.2% uptick. Applications were at the lowest level of the economic recovery. [...]
The Mortgage Bankers Association reported that their total Mortgage Market Volume Index declined 7.2% last week (-15.0% y/y) after the prior week's 0.2% uptick. Applications were at the lowest level of the economic recovery. Applications to refinance an existing loan dropped 10.7% (-17.2% y/y) to the lowest level of the economic recovery. Home purchase applications fell 2.6% (-12.0% y/y) after the prior week's 1.5% decline.
The effective interest rate on a 15-year mortgage slipped to 3.51% but has moved sideways since May. The effective rate on a 30-year fixed rate loan remained fairly stable at 4.35%, down versus last year's high of 4.79%. The rate on a Jumbo 30-year loan declined to 4.22%, the lowest level since May of last year. For adjustable 5-year mortgages, the effective interest rate fell to 3.28% and was down versus last year's 3.58% peak.
The average mortgage loan size held fairly steady at $248,200. For home purchases, the average loan size fell w/w to $268,000. For refinancings, it jumped w/w to $232,200, the highest level since June 2012.
Applications for fixed interest rate loans declined 15.4% y/y while adjustable rate loan applications were off 10.0% y/y.
The survey covers over 75 percent 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.
Using the Federal Reserve's Beige Book to track economic activity from the Federal Reserve Bank of Chicago can be found here.
| MBA Mortgage Applications (SA, 3/16/90=100) | 09/05/14 | 08/29/14 | 08/22/14 | Y/Y% | 2013 | 2012 | 2011 |
|---|---|---|---|---|---|---|---|
| Total Market Index | 327.2 | 352.7 | 352.0 | -15.0 | 616.6 | 813.8 | 572.3 |
| Purchase | 161.5 | 165.8 | 168.4 | -12.0 | 197.5 | 187.8 | 182.6 |
| Refinancing | 1,265.0 | 1,415.8 | 1,396.2 | -17.2 | 3,070.0 | 4,505.0 | 2,858.4 |
| 15-Year Mortgage Effective Interest Rate (%) | 3.51 | 3.56 | 3.56 | 3.80 (9/13) |
3.42 | 3.25 | 3.97 |
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.
More Economy in Brief
