Haver Analytics
Haver Analytics
USA
| Dec 21 2022

U.S. Mortgage Applications Up for the Second Week After Two Consecutive Weekly Declines

Summary
  • Applications for loans to purchase edge down in the week of December 16.

  • Applications for refinancing a loan rise for the third straight week.

  • Mortgage rates fall for fixed-rate loans, Jumbos and ARMs; their lowest rates since September.

Mortgage applications rose 0.9% w/w (-63.9% y/y) in the week ending December 16 after a 3.2% increase in the week ending December 9, according to the Mortgage Bankers Association's (MBA) Weekly Mortgage Applications Survey. Applications for loans to purchase a house ticked down 0.1% (-36.5% y/y), the second w/w decline in three weeks, following a 4.0% rebound in the previous week. Applications for refinancing a loan rose 6.0% (-84.5% y/y), the fourth w/w rise in five weeks, after a 2.8% increase in the prior week.

The share of applications for refinancing an existing loan rose to 31.3% of total applications in the December 16 week from 29.4% in the previous week, registering the highest reading since the September 16 week of 32.5%. These latest weeks' shares were still down from 65.4% in the week of December 31, 2021. The adjustable-rate mortgage (ARM) share of activity declined to 7.5% in the December 16 week after rising to 7.7% in the prior week.

The Federal Reserve raised its short-term rate target on December 14, but longer-term rates, including mortgage rates, fell for the week ending December 16. The effective rate on a 30-year fixed-rate loan was at 6.51% in the December 16 week, down from 6.60% in the previous two weeks. The latest reading was the lowest since the September 16 week of 6.45% but significantly above the 3.42% average rate in December 2021. The rate on 15-year fixed-rate mortgages fell to 5.94% in the December 16 week from 6.05% in the December 9 week and the rate on a 30-year Jumbo loan fell to 6.12% from 6.26%, posting their lowest readings since the September 16 week. The rate on a 5-year ARM loan decreased to 5.78%, the lowest since the September 30 week, from 5.88%.

The average loan size fell to $358,300 (+2.9% y/y) in the December 16 week, the second w/w fall in three weeks, from $364,400 in the December 9 week. The series high of $401,900 was reached in the May 6 week. The average size of a purchase loan declined to $398,000 (-4.4% y/y) in the December 16 week from a five-week-high $401,400 in the prior week and the average size of a loan to refinance a mortgage slid to $271,100 (-13.1% y/y) from a five-week-high $275,500.

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.

  • Winnie Tapasanun has been working for Haver Analytics since 2013. She has almost 20 years of working in the financial services industry. As Vice President and Economic Analyst at Globicus International, Inc., a New York-based company specializing in macroeconomics and financial markets, Winnie oversaw the company’s business operations, managed financial and economic data, and wrote daily reports on macroeconomics and financial markets. Prior to working at Globicus, she was Investment Promotion Officer at the New York Office of the Thailand Board of Investment (BOI) where she wrote monthly reports on the U.S. economic outlook, wrote reports on the outlook of key U.S. industries, and assisted investors on doing business and investment in Thailand. Prior to joining the BOI, she was Adjunct Professor teaching International Political Economy/International Relations at the City College of New York. Prior to her teaching experience at the CCNY, Winnie successfully completed internships at the United Nations.   Winnie holds an MA Degree from Long Island University, New York. She also did graduate studies at Columbia University in the City of New York and doctoral requirements at the Graduate Center of the City University of New York. Her areas of specialization are international political economy, macroeconomics, financial markets, political economy, international relations, and business development/business strategy. Her regional specialization includes, but not limited to, Southeast Asia and East Asia.   Winnie is bilingual in English and Thai with competency in French. She loves to travel (~30 countries) to better understand each country’s unique economy, fascinating culture and people as well as the global economy as a whole.

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