Global| Mar 17 2010U.S. Weekly Mortgage Applications Rise Again In March
by:Tom Moeller
|in:Economy in Brief
Summary
The Mortgage Bankers Association reported that mortgage applications regained their footing during the last three weeks. Despite a 1.9% decline last week, applications in March are 4.8% higher than in February when they rose 10.8% [...]
The Mortgage Bankers Association reported that mortgage applications regained their footing during the last three weeks. Despite a 1.9% decline last week, applications in March are 4.8% higher than in February when they rose 10.8% from January. Applications so far this month are at their highest level since October of last year.
The gain likely has been fueled by an $8,000 Federal tax credit which is due to expire April 30. For last week, applications to purchase a home fell 2.3% but they were 6.2% higher than in February. During the last ten years there has been a 51% correlation between the y/y change in purchase applications and the change in new plus existing single family home sales. The correlation has lessened recently. For mortgage refinancings applications fell by roughly 1.5% for the second week but they still were at their highest in March since last August due to low interest rates.
The effective fixed interest rate on conventional 15-year mortgages fell slightly to 4.60%. For the month, overall rates have been near the six year low. For 30-year mortgages the rate also slipped to 5.17%. Rates reached a high of 5.79% in early-June. Interest rates on fixed 15-year and 30-year mortgages are closely correlated (near-90%) with the rate on 10-year Treasury securities. Rates on adjustable one-year mortgages rose slightly to 6.83% last week.
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. Visit the Mortgage Bankers Association site here.The figures for weekly mortgage applications are available in Haver's SURVEYW database.
Today's testimony by Fed Chairman Bed S. Bernanke, The Federal Reserve's role in bank supervision, can be found here.
| MBA Mortgage Applications (SA, 3/16/90=100) | 03/12/10 | 03/05/10 | 02/26/10 | Y/Y | 2009 | 2008 | 2007 |
|---|---|---|---|---|---|---|---|
| Total Market Index | 620.9 | 633.1 | 629.9 | -29.2% | 736.4 | 642.9 | 652.6 |
| Purchase | 221.5 | 226.8 | 214.5 | -13.8 | 263.5 | 345.4 | 424.9 |
| Refinancing | 2,955.9 | 3,007.2 | 3,054.3 | -34.3 | 3,509.2 | 2,394.1 | 1,997.9 |
| 15-Year Mortgage Effective Interest Rate (%) | 4.60 | 4.54 | 4.61 | 4.77 (03/09) | 4.85 | 5.9 | 6.2 |
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.
