Weekly mortgage applications rise 0.1% as average loan size shrinks
2015-07-23
Call it groundhog week. Mortgage application volume barely moved at all, eking out a 0.1 percent gain on a seasonally adjusted basis for the week ending July 17 from the previous week, according to the Mortgage Bankers Association (MBA). Volume, however, is better than a year ago by just over 8 percent.
What refinance volume lost, purchase volume gained. Applications to refinance fell 1 percent from the previous week, while purchase applications rose 1 percent, both seasonally adjusted. Purchase applications are still 18 percent higher than they were a year ago, but are down five percent in the last four weeks.
There was one noteworthy move in the data: The average loan size appears to have shrunk on purchase applications since May, even as home prices rise. It is now at the lowest level since February.
"Given the overall increase in purchase volume, we view this as a positive development, as it signifies more first-time homebuyers getting into the market," noted Mike Fratantoni, chief economist for the MBA. "We are not back to levels typical of a healthy market, but for the first time in a while it is steadily improving."
Mortgage rates have been volatile since early May, but seem to have settled again. This may be the cause of a pull-back in the share of adjustable-rate loan applications (ARMs), which had been rising steadily. ARMs offer lower interest rates but are higher risk in a rising rate environment.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,000 or less) remained unchanged at 4.23 percent, with points decreasing to 0.34 from 0.39 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans, according to the MBA.
Source：CNBC
There was one noteworthy move in the data: The average loan size appears to have shrunk on purchase applications since May, even as home prices rise. It is now at the lowest level since February.
"Given the overall increase in purchase volume, we view this as a positive development, as it signifies more first-time homebuyers getting into the market," noted Mike Fratantoni, chief economist for the MBA. "We are not back to levels typical of a healthy market, but for the first time in a while it is steadily improving."
Mortgage rates have been volatile since early May, but seem to have settled again. This may be the cause of a pull-back in the share of adjustable-rate loan applications (ARMs), which had been rising steadily. ARMs offer lower interest rates but are higher risk in a rising rate environment.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($417,000 or less) remained unchanged at 4.23 percent, with points decreasing to 0.34 from 0.39 (including the origination fee) for 80 percent loan-to-value ratio (LTV) loans, according to the MBA.
Source：CNBC
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