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Economy in Brief

U.S. Mortgage Applications Rebound
by Tom Moeller  April 21, 2021

• Refinancing & purchase applications jump.

• Mortgage interest rates ease again.

The Mortgage Bankers Association Mortgage Loan Applications Index increased 8.6% (-5.7% y/y) in the week ended April 16, following six consecutive weekly declines. Despite the latest increase, the level of applications has fallen slightly since the end of last month. Applications for refinancing increased 10.4% (-23.5% y/y) and also followed six weeks of decline. Applications to purchase a home improved 5.7% (58.5% y/y) after falling for three straight weeks.

The refinance share of mortgage activity rose slightly to 60.0% of total applications. This share has declined from a peak of 74.8% in early January. The adjustable rate mortgage (ARM) share of activity held steady at 3.6% last week.

Mortgage interest rates fell last week. The effective interest rate on a 30-year mortgage declined to 3.30% from 3.37% in the prior week but remained above the 2.96% rate at the beginning of the year. The effective 15-year rate eased to 2.75% from 2.78%, compared to 2.47% at the start of the year. The effective rate for a 30-year Jumbo mortgage eased to 3.42% after falling to 3.45% in the prior week. The rate on a five-year ARM rose to 2.87% from 2.74%.

The average mortgage loan size increased to $330,200 in the week ended April 16. The average size of a purchase loan edged increased to $406,100. The average size of a refinanced loan fell to $279,500.

Applications for fixed-rate loans rose 8.5% (-6.5% y/y) last week following six consecutive weekly declines. Applications for adjustable-rate mortgages increased 8.7% (22.6% y/y) last week after falling 6.3% in the prior week.

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. The figures for weekly mortgage applications and interest rates are available in Haver's SURVEYW database.

MBA Mortgage Applications (%, SA) 04/16/21 04/09/21 04/02/21 Y/Y 2020 2019 2018
Total Market Index 8.6 -3.7 -5.1 -5.7 63.0 32.4 -10.4
  Purchase 5.7 -1.4 -4.6 58.5 11.4 6.6 2.1
  Refinancing 10.4 -5.0 -5.3 -23.5 111.0 71.1 -24.3
30-Year Effective Mortgage Interest Rate (%) 3.30 3.37 3.48 3.54

(Apr '20)

3.40 4.34 4.94
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