Mortgage Demand Rises As Rates Fall

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According to the Mortgage Bankers Association’s Weekly Applications Survey, demand for mortgage applications rose 4.7 percent last week from the week before. The increase included a 6 percent jump in the Refinance Index and a 3 percent improvement in the number of people seeking applications for loans to buy homes. Purchase application demand – which is a good indicator of future home sales – is now 23 percent higher than it was the same week one year ago. The increase in activity was a needed boost after consecutive weeks when demand for mortgage applications was relatively flat. Lynn Fisher, MBA’s vice president of research and economics, said the gains were due to average mortgage rates falling last week. “Despite recent concerns about the economy, both purchase and refinance applications increased strongly in response to lower interest rates last week,” Fisher said. “Refinance activity was the highest since May when rates were last at this level. The increase in purchase activity was also notable for this time of year, up 23 percent relative to a year ago.” The MBA’s weekly survey has been conducted since 1990 and covers 75 percent of all retail residential mortgages. More here.

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