U.S. Mortgage Applications Fell in the October 16 Week
Summary
- Applications for loans to purchase and applications for loan refinancing both declined in the latest week.
- Interest rate on 30-year fixed-rate loans fell 12bps to 7.63%, the first decline in 8 weeks.
- Average loan size rose slightly in the October 16 week.
Mortgage applications fell 5.3% w/w (-40.4% y/y) in the week ending October 16, the 7th consecutive weekly decline and after declining 2.7% w/w (-37.2% y/y) in the week ending October 9, according to the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey. Applications for loans to purchase a house fell 7.3% w/w (-17.9% y/y) in the latest week, after declining 4.0% w/w (-16.1% y/y) in the October 9 week. Applications for loan refinancing fell 2.0% w/w (-58.6% y/y) in the October 16 week following a decline of 0.4% w/w (-56.0% y/y) in the October 9 week.
The effective interest rate on a 30-year fixed-rate loan fell 12bps to 7.63% in the week ending October 16 from 7.75% in the week ending October 9, and after rising for 8 consecutive weeks. The rate on 15-year fixed-rate mortgages fell 18bps to 6.91% in the October 16 week from 7.09% in the October 9 week. The 30-year Jumbo rate fell 19bps to 7.50% in the latest week from 7.69% in the October 9 week. The rate on a 5-year ARM declined 9bps to 6.87% in the October 16 week from 6.96% in the October 9 week.
The share of applications for refinancing an existing loan rose to 39.0% of total applications in the week of October 16 from 37.7% in the week ending October 9. The adjustable-rate mortgage (ARM) share of activity was unchanged at 10.5% in the latest week.
The average size of a mortgage rose 0.5% w/w (-10.3% y/y) to $372,100 in the week ending October 16, after declining 2.0% w/w (-7.5% y/y) to $370,200 in the week ending October 9. The average size of a purchase loan was unchanged at $444,700 in the October 16 week after declining 0.8% w/w in the October 9 week. The average size of a loan to refinance a mortgage rose 4.5% w/w to $258,400 in the week ending October 16 after declining 3.9% w/w to $247,200 in the October 9 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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