Courtesy: Haver Analytics

The Mortgage Bankers Association reported that mortgage applications jumped another 6.7% last week.           The increase raised the level 14.6% versus June and by nearly one-half from July '09.  Firm lending activity continued to reflect strong refinancings.  Weekly applications for mortgage refinance jumped for the second consecutive week to the highest level since May of last year.. 

Applications to purchase a home remained weak and fell to near the lowest level since early-1997.           During the last ten years there has been a 51% correlation between the y/y change in purchase applications and the change in new plus existing single family home sales.  The correlation has lessened recently.

The effective fixed interest rate on conventional 15-year mortgages nudged up to 4.34% last week.         For 30-year mortgages the rate fell slightly to an average 4.85%, near the lowest since the early-1960s. Interest rates on fixed 15-year and 30-year mortgages are closely correlated (near-90%) with the rate on 10-year Treasury securities.  Rates on adjustable one-year mortgages rose w/w to 7.26% from 6.74% at the end of last year. 

The Mortgage Bankers Association surveys between 20 to 35 of the top lenders in the U.S. housing industry to derive its refinance, purchase and market indexes.  The weekly survey covers roughly 50% of all U.S. residential mortgage applications processed each week by mortgage banks, commercial banks and thrifts.  Visit the Mortgage Bankers Association site here.  The figures for weekly mortgage applications are available in Haver's SURVEYW database.