U.S. Mortgage Applications Edged Lower Last Week
Summary
- Purchase applications and loan refinancing fell in latest week.
- Effective interest rate on 30-year fixed-rate loan declined minimally.
- Average loan size edged up in latest week.
Mortgage applications dropped 3.8% (+22.1% y/y) in the week ending July 25, after increasing 0.8% (22.1% y/y) in the week ending July 18, according to the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey. Applications for loans to purchase a home dropped 5.8% (+17.2% y/y) last week, following a rise of 3.4% (22.5% y/y) in the week of July 18. Applications for loan refinancing declined 1.1% (+29.5% y/y) in the July 25 week, after decreasing 2.6% (+21.6% y/y) in the July 18 week.
The effective interest rate on a 30-year fixed-rate loan edged down 2bps to 7.00% in the week ending July 25, from 7.02% in the week ending July 18. The recent low of 6.29% was reached in the week of September 20, 2024. The rate on 15-year fixed-rate mortgages declined by 4bps to 6.28% in the latest week from 6.32% in the July 18 week. It has risen from a low of 5.60% in the week of September 20, 2024. The rate on 30-year Jumbo loans dropped 6bps to 6.89% in the week ending July 25 from 6.95% one week earlier. It was up from a low of 6.57% in the week of September 13, 2024. The rate on a 5-year ARM jumped 28bps to 6.40% in the July 25 week from 6.12% in the week of July 18. It was above a low of 5.84% in the week of September 18, 2024.
The share of applications for refinancing an existing loan rose to 40.7% of total applications in the week ending July 25, from 39.6% in the prior week. The adjustable-rate mortgage (ARM) share of activity rose to 8.30% in the latest week from 7.20% in the week of July 18.
The average size of a mortgage loan edged up 0.7% (1.9% y/y) to $374,400 in the week of July 25, following 1.0% decline in the prior week. The average size of a purchase loan rose 0.6% (0.8% y/y) to $429,200 in the latest week after declining 0.5% in the week ending July 18. The average size of a loan to refinance a mortgage rose 2.3% (7.9% y/y) to $294,500 in the July 25 week, after falling 3.8% in the prior 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).
More Economy in Brief
