Global| Feb 24 2010U.S. Weekly Mortgage Applications Slip Again
by:Tom Moeller
|in:Economy in Brief
Summary
The housing market's upturn increasingly looks to have lost steam. The Mortgage Bankers Association reported that mortgage applications slipped 8.5% last week for the third week consecutive weekly decline. Nevertheless, it's not all [...]
The housing
market's upturn increasingly looks to have lost steam. The Mortgage
Bankers Association reported that mortgage applications slipped 8.5%
last week for the third week consecutive weekly decline. Nevertheless,
it's not all bad news since a late-January jump in applications was not
wholly unwound. The February average of applications still is up 8.8%
from January.
For last week, applications to refinance mortgages fell 8.9% and applications to purchase a home fell 7.3%, the third down week. Overall, there has been a downtrend in purchase applications despite an uplift provided by an up-to $8,000 Federal tax credit for first-time homebuyers. 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.
The effective fixed interest rate
on conventional 15-year mortgages moved higher again to 4.68%. For the
month overall rates have been near the six year low. For 30-year
mortgages the rate also ticked up to 5.30% from a November average of
5.06%. 
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 fell to 6.64% last week from a November average of
6.81%.
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.
| MBA Mortgage Applications (SA, 3/16/90=100) | 02/19/10 | 02/12/10 | 02/05/10 | Y/Y | 2009 | 2008 | 2007 |
|---|---|---|---|---|---|---|---|
| Total Market Index | 549.5 | 600.5 | 613.1 | -26.1% | 736.4 | 642.9 | 652.6 |
| Purchase | 196.8 | 212.3 | 221.2 | -21.4 | 263.5 | 345.4 | 424.9 |
| Refinancing | 2,605.3 | 2,860.1 | 2,893.9 | -28.0 | 3,509.2 | 2,394.1 | 1,997.9 |
| 15-Year Mortgage Effective Interest Rate (%) | 4.68 | 4.59 | 4.57 | 5.07 (02/09) | 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.
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