U.S. Mortgage Applications dropped in the May 15 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 6.73%.
- Average loan size declined.
Mortgage applications declined 2.3% w/w (+18.9% y/y) in the week ending May 15, after rising 1.7% w/w (15.5% y/y) in the week ending May 8, according to the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey. Applications for loans to purchase a house dropped 4.1% w/w (+8.0% y/y) in the May 15 week, following a rise of 3.9% w/w (6.7% y/y) in the May 8 week. Applications for loan refinancing edged down 0.1% w/w (+34.8% y/y) in the latest week after declining 0.8% w/w (+28.3% y/y) in the May 8 week.
The effective interest rate on a 30-year fixed-rate loan rose 9bps to 6.73% in the week ending May 15 from 6.64% in the week ending May 8. The rate on 15-year fixed-rate mortgages rose 12bps to 6.11% in the latest week from 5.99% in the week ending May 8. The 30-year Jumbo rate rose 5bps to 6.69% in the May 15 week from 6.64% in the May 8 week. The rate on a 5-year ARM also rose 5bps to 6.07% in the latest week from 6.02% in the week ending May 8.
The share of applications for refinancing an existing loan rose to 41.9% of total applications in the week of May 15 from 40.8% in the May 8 week. The adjustable-rate mortgage (ARM) share of activity rose to 9.6% in the May 15 week from 8.8% in the week ending May 8.
The average size of a mortgage loan declined 1.4% w/w (+3.5% y/y) to $403,200 in the week ending May 15, after retrenching 0.5% w/w (+2.9% y/y) to $409,000 in the week ending May 8. The average size of a purchase loan edged down 0.1% w/w (+4.6% y/y) to $466,900 in the latest week from $467,200 in the May 8 week. The average size of a loan to refinance a mortgage declined 3.0% w/w (+8.1% y/y) to $314,700 in the May 15 week from $324,500 in the May 8 week.
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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