U.S. Mortgage Applications Declined in the July 24 Week
Summary
- Both applications for loans to purchase and applications for loan refinancing declined in the latest week.
- Interest rate on 30-year fixed-rate loans rose 9bps to 6.96%.
- Average loan size edged up.
Mortgage applications dropped 6.4% w/w (+0.6% y/y) in the week ending July 24, after rising 1.9% w/w (3.3% y/y) in the week ending July 17, according to the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey. Applications for loans to purchase a house declined 3.6% w/w (+2.7% y/y) in the latest week, after rising 5.5% w/w (0.4% y/y) in the July 17 week. Applications for loan refinancing plummeted another 9.9% w/w (-2.2% y/y) in the July 24 week, following a decline of 2.4% w/w (+7.3% y/y) in the week ending July 17.
The effective interest rate on a 30-year fixed-rate loan rose 9bps to 6.96% in the week ending July 24 from 6.87% in the week ending July 17. The rate on 15-year fixed-rate mortgages rose 10bps to 6.36% in the July 24 week from 6.26% in the July 17 week. The 30-year Jumbo rate jumped 28bps to 6.85% in the latest week after dropping 20bps to 6.57% in the July 17 week. The rate on a 5-year ARM rose 6bps to 6.44% in the July 24 week from 6.38% in the July 17 week.
The share of applications for refinancing an existing loan declined to 39.5% of total applications in the week of July 24 from 41.2% in the July 17 week. The adjustable-rate mortgage (ARM) share of activity rose to 8.1% in the July 24 week from 7.7% in the July 17 week.
The average size of a mortgage edged up 0.3% w/w (2.8% y/y) to $384,700 in the week of July 24, after rising 1.1% w/w to $383,700 in the week ending July 17. The average size of a purchase loan edged up 0.4% w/w (3.8% y/y) to $445,400 in the July 24 week, after rising 0.4% w/w to $443,800 in the July 17 week. The average size of a loan to refinance a mortgage declined 2.0% w/w (-0.9% y/y) to $291,800 in the week ended July 24, following a small rise of 0.2% w/w to $297,900 in the week ending July 17.
The Mortgage Bankers Association 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.
Kathleen Stephansen, CBE
AuthorMore in Author Profile »Kathleen Stephansen is a Senior Economist for Haver Analytics and an Independent Trustee for the EQAT/VIP/1290 Trust Funds, encompassing the US mutual funds sponsored by the Equitable Life Insurance Company. She is a former Chief Economist of Huawei Technologies USA, Senior Economic Advisor to the Boston Consulting Group, Chief Economist of the American International Group (AIG) and AIG Asset Management’s Senior Strategist and Global Head of Sovereign Research. Prior to joining AIG in 2010, Kathleen held various positions as Chief Economist or Head of Global Research at Aladdin Capital Holdings, Credit Suisse and Donaldson, Lufkin and Jenrette Securities Corporation.
Kathleen serves on the boards of the Global Interdependence Center (GIC), as Vice-Chair of the GIC College of Central Bankers, is the Treasurer for Economists for Peace and Security (EPS) and is a former board member of the National Association of Business Economics (NABE). She is a member of Chatham House and the Economic Club of New York. She holds an undergraduate degree in economics from the Universite Catholique de Louvain and graduate degrees in economics from the University of New Hampshire (MA) and the London School of Economics (PhD abd).
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