"Economists are pessimists: they've predicted 8 of the last 3 depressions."
--Barry Asmus

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Wednesday, March 9, 2011

MBA Weekly Applications Survey

The Mortgage Bankers Association has released its Weekly Application Survey, which is a look at the rate of change in applications for mortgages for both initial purchases and refinances.  In and of itself, this is not a huge market mover.  It can give some indications about the direction of New Home Sales and Existing Home Sales, as well as some indications about the health of lending agencies, so it is watched by people with an interest in real estate or the financial sector.
The results of the survey for the week ending 2/25 were not great.  The Market Composite Index showed a 6.5% decline, the Purchase Index showed a 6.1% decline, and the Refinance Index showed a 6.5% decline.
Turning to the MBA press release for the week ending 3/4, things have substantially improved.  The Market Composite Index has increased 15.5%, while the Purchase Index increased 12.5% and the Refinance Index increased 17.2%.  Refinance applications represented 65.5% of total mortgage applications for the week (an increase from the previous week's 64.9%), while adjustable-rate mortgages represented 6.0% of total mortgage applications for the week (an increase from the previous week's 5.5%).  The average interest rate for 30-year fixed-rate mortgages also increased from last week's 4.84% to this week's 4.93% (which is consistent with the increased demand for mortgages).

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