Home Buyers Push Up Loan Demand
Mortgage applications were on the rise last week, as home buyers remain behind the upswing in demand. The Mortgage Bankers Association reported that applications for home purchases, viewed as a leading indicator of future home sales, rose 5 percent week-over-week on a seasonally adjusted basis for the week ending April 17.
Applications for home purchases are now 16 percent higher than the same week one year ago.
"Purchase applications increased for the fourth time in five weeks as we proceed further into the spring homebuying season," says Mike Fratantoni, chief economist for the MBA. "Applications for FHA purchase loans remained strong as well."
Overall, MBA's mortgage application index, which reflects combined applications for refinances and home purchases, rose 2.3 percent last week. Applications for refinances increased only 1 percent last week but remain up 41 percent from a year ago due to lower mortgage rates. A year ago at this time, the 30-year fixed-rate mortgage was significantly higher, averaging around 4.25 percent.
The average 30-year fixed-rate mortgage has mostly hovered around historical lows for the past few weeks. Last week, it dropped slightly to 3.83 percent, its lowest level since January, MBA reports.
Source: “Mortgage Applications Rise 2.3%, Led by Homebuyers,” CNBC.com (April 22, 2015)
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