Global| Jun 01 2022U.S. Mortgage Applications Decline Further
by:Tom Moeller
|in:Economy in Brief
Summary
- Loan refinancing continues to fall sharply.
- Purchase applications slip.
- Interest rates ease.
The Mortgage Bankers Association's Loan Applications Index weakened 2.3% (-53.7% y/y) in the week ended May 27 after declining 1.2% in the prior week. Applications to refinance an existing loan continued to lead the decline with 5.4% drop (-75.1% y/y) after falling 3.9% in the week earlier. Applications for purchase eased 0.6% (-14.3% y/y) after rising 0.2% in the prior week.
The share of applications for refinancing fell to 31.5% in the week ended May 27, half the percentage in December 2021 and nearly the lowest reading since December 2000. The percentage that were ARMs fell to 8.7%
Applications for fixed-rate loans fell 1.5% (-56.1% y/y) in the week ended May 27. Meanwhile, applications for adjustable-rate mortgages fell 10.1% (+8.0% y/y).
The effective rate on 30-year fixed-rate loans fell to 5.48% last from 5.64% in the prior week. It remained near the highest reading since June 2009. The rate for 15-year fixed mortgages slipped to 4.75% and for 30-year Jumbos slipped to 5.05%. The rate on 5-year ARMs was little-changed w/w at 4.71%, up from 2.57% at the end of last year.
The average loan size of $385,600 was down sharply from $401,900 at the beginning of the month. The average size of a purchase loan rose slightly to $433,200. The average refinancing loan size was $282,100.
This survey covers over 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.
These figures for weekly mortgage applications and interest rates are available in Haver's SURVEYS database.
Tom Moeller
AuthorMore in Author Profile »Prior to joining Haver Analytics in 2000, Mr. Moeller worked as the Economist at Chancellor Capital Management from 1985 to 1999. There, he developed comprehensive economic forecasts and interpreted economic data for equity and fixed income portfolio managers. Also at Chancellor, Mr. Moeller worked as an equity analyst and was responsible for researching and rating companies in the economically sensitive automobile and housing industries for investment in Chancellor’s equity portfolio. Prior to joining Chancellor, Mr. Moeller was an Economist at Citibank from 1979 to 1984. He also analyzed pricing behavior in the metals industry for the Council on Wage and Price Stability in Washington, D.C. In 1999, Mr. Moeller received the award for most accurate forecast from the Forecasters' Club of New York. From 1990 to 1992 he was President of the New York Association for Business Economists. Mr. Moeller earned an M.B.A. in Finance from Fordham University, where he graduated in 1987. He holds a Bachelor of Arts in Economics from George Washington University.
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