Mortgage Applications Continue to Increase
by:Tom Moeller
|in:Economy in Brief
Summary
- Refinancing increase outpaces purchase application gain.
- Interest rates ease.
Mortgage loan applications increased 2.9% (-46.5% y/y) in the week ended March 24 following a 3.0% rise in the prior week. It was the fourth consecutive weekly gain. Applications remained near the lowest level since 1997. These data are from the Mortgage Bankers Association's (MBA) Weekly Mortgage Applications Survey.
Applications to refinance an existing loan increased 4.8% (-61.1% y/y) following a 4.9% gain. It also was the fourth straight weekly rise. Purchase loan applications also improved for the fourth consecutive week. The 2.0% gain (-35.3% y/y) followed a 2.2% increase.
The percentage of applications for refinancing an existing loan rose to 29.1% in the week ended March 24 from 28.6% in the previous week. The percentage of ARM loan applications fell to 7.7% from 8.6% in the prior week. It was the fewest in five weeks.
The effective interest rate on a 30-year fixed-rate loan eased to 6.63% last week from 6.67% in the week previous. This compares to an average of 6.68% for the four weeks of February, down from a 7.02% high at the beginning of March. The effective rate on 15-year fixed-rate mortgages declined to 5.98% from 6.17% in the prior week. It was the lowest rate in seven weeks, down from a 6.77% high in the third week of October. The rate on 30-year Jumbo loans slipped to 6.42% from 6.46%. The rate on a 5-year ARM rose to 5.95% from 5.86%, but remained below a 6.21% high early in November.
The average loan size fell 1.2% (-0.9% y/y) to $384,300 in the week ended March 24. The series high of $401,900 was reached in the week ended May 6, 2022. The average size of a purchase loan declined 1.6% (-4.9%) in the latest week to $430,500. The average loan size to refinance an existing mortgage increased 1.5% (-7.2% y/y) to $271,800.
The Mortgage Bankers Survey covers 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 SURVEYS database.
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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