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Economy in Brief

U.S. Mortgage Applications Mixed, but Little Changed
by Carol Stone, CBE  May 5, 2021

• Applications to purchase edge downward, those for refinancing edge upward.

• Mortgage interest rates mostly up, but changes very small.

The Mortgage Bankers Association Mortgage Loan Applications Index decreased 0.9% (-5.9% y/y) in the week ended April 30, following a decline of 2.5% the previous week. Applications to purchase a home fell 2.5% (+24.8% y/y) after a 4.8% decline. Applications for refinancing edged upward 0.1% (-16.9% y/y) after decreasing 1.1% in the prior week.

The refinance share of mortgage activity edged upward to 61.0% of total applications, extending a steady rate close to 60% into a seventh week. The adjustable rate mortgage (ARM) share of activity rose to 3.9% last week.

Mortgage interest rates changed little last week. The effective interest rate on a 30-year mortgage was 3.28%, up from 3.26% the prior week, and it remained above the 2.96% rate at the beginning of the year. The effective 15-year rate ticked downward to 2.62% from 2.63% and compares to 2.47% at the start of the year. The effective rate for a 30-year Jumbo mortgage edged up to 3.39% after falling to 3.37% in the prior week. The rate on a five-year ARM was 2.84% in the April 30 week, up from 2.76%

The average mortgage loan size increased to $337,000 in the April 30 week, up from $330,000 the prior week. The average size of a loan to purchase a house rose to $408,100 from $400,100. The average size of a refinance loan was $291,500, up from $284,300.

Applications for fixed-rate loans fell 1.3% (-6.7% y/y) last week following a 2.4% decline the week before and an increase of 8.5% the week before that (April 16). By contrast, applications for adjustable-rate mortgages increased 9.4% following a decline of 5.4% and an increase of 8.7%. So this application activity has been quite mixed, week to 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) 04/30/21 04/23/21 04/16/21 Y/Y 2020 2019 2018
Total Market Index -0.9 -2.5 8.6 -5.9 63.0 32.4 -10.4
  Purchase -2.5 -4.8 5.7 24.8 11.4 6.6 2.1
  Refinancing 0.1 -1.1 10.4 -16.9 111.0 71.1 -24.3
30-Year Effective Mortgage Interest Rate (%) 3.28 3.26 3.30 3.54

(Apr '20)

3.40 4.34 4.94
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