Haver Analytics
Haver Analytics
| May 17 2023

Mortgage Loan Applications Fall Sharply

  • Mortgage applications remain near cycle low.
  • Effective interest rate increases to two-month high.
  • Average loan size declines.

Mortgage loan applications fell 5.7% (-32.7% y/y) in the week ended May 12, and reversed a 6.3% increase in the prior week. These data come from the Mortgage Bankers Association’s Weekly Mortgage Applications Survey.

Applications for loans to purchase a home fell 4.8% (-26.5% y/y) in the latest week following a 4.8% increase in the prior week. Applications to refinance an existing loan declined 7.7% (-43.4% y/y) last week after a 10.0% rise the prior week.

The share of loans to refinance an existing mortgage in the week of May 12 was 27.4%, down from 28.0% in the prior week. The share of loans with an adjustable rate remained low at 6.5% versus 6.8% the week before.

The effective interest rate on a 30-year fixed rate loan was 6.74% in the week of May 12 versus 6.66% the week before. That rate was 7.02% in the March 3 week and 7.42% on October 21. The rate on a 15-year fixed-rate mortgage rose to 6.13% last week and reversed the decline in the prior week. The rate on a 30-year Jumbo loan rose to 6.57% last week from 6.48% the week before. For a 5-year ARM loan, the effective rate spiked to 6.12% from 5.64%. It was the highest level since early-November.

The average size of a mortgage loan fell 0.9% to $391,300 last week (+0.6% y/y) from $395,000 in the prior week. The average size of a purchase loan eased to $440,400 in the latest week, down 0.1% (-0.2% y/y) from $441,700 during the week before. Refinance loans averaged $261,300 in the week of May 12, down 6.0% (-7.7% y/y) from the prior week.

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.

  • 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 in Author Profile »

More Economy in Brief