Paper Economy - A US Real Estate Bubble Blog: Reading Rates: MBA Application Survey

Wednesday, February 15, 2012

Reading Rates: MBA Application Survey – February 15 2012

The Mortgage Bankers Association (MBA) publishes the results of a weekly applications survey that covers roughly 50 percent of all residential mortgage originations and tracks the average interest rate for 30 year and 15 year fixed rate mortgages as well as the volume of both purchase and refinance applications.

The purchase application index has been highlighted as a particularly important data series as it very broadly captures the demand side of residential real estate for both new and existing home purchases.

The latest data is showing that the average rate for a 30 year fixed rate mortgage (from FHA and conforming GSE data) increased 1 basis point to 3.98% since last week while the purchase application volume declined 8.4% and the refinance application increased 0.8% over the same period.

With rates trending ever lower, the economy seemingly near recession and the FOMC members becoming more dovish by the day, it will be interesting to see how far rates on the long end can decline. All things being equal, falling home prices, declining purchase applications and record low long lending rates all appear to indicate a deflationary for the macro-economy.

The following chart shows the average interest rate for 30 year and 15 year fixed rate mortgages since 2006 as well as the purchase, refinance and composite loan volumes (click for larger dynamic full-screen version).

Labels: economy, mortgage rates, purchase applications

5 Comments:

"While all indicators made notable increased again in February, it's important to note that conditions still remain distressed by historic standards though, the last few months results appears to indicate a major change in the builder sentiment."

Perhaps the Obama administration and the proper organizations can do something to help push it further to the improvement of the housing market!

By Jonas Fulton, at 2:29 AM
It really shows that there is a change in real estate survey. Thank you for sharing this to us. I hope there is a good result by tomorrow.

By property sale in usa, at 8:35 AM
Hello Friends.........

Great information.Thanks for sharing this useful information with all of us.Keep sharing more in the future.

Have a nice time ahead.

Thanks

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