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For the first time in four weeks, mortgage applications saw a hike, rising by 2.9% over the last week. The housing demand is atypically strong as we come to the end of summer, says the Mortgage Bankers Association.
The MBA’s associate vice president of economic and industry forecasting, Joel Kan, stated in a press release that “Purchase applications were 40% higher than the same week last year, but the increase is skewed higher by being compared to Labor Day 2019. Nevertheless, there continues to be resiliency in the purchase market. Applications were up almost 3% on a weekly basis and the average loan size continued to increase, hitting a survey high at $368,600.”
The MBA’s Weekly Mortgage Applications Survey for the week closing on Sept. 4, 2020 reveals a 3% hike in the refinance index compared to a week ago and a whopping 60% hike than at the same time last year. Mortgage activity’s refinance share shot up by 0.6% over the last week, sitting at 63.1% currently.
Kan further stated that “Mortgage rates declined last week, with a noteworthy 5-basis-point decrease in the 15-year fixed rate to a new record low of 2.62%. The drop in rates led to a rebound in refinancing activity, driven mainly by borrowers applying for conventional loans.”
There is a 1 basis point decrease in the average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($510,400 or less). They currently sit at 3.07%. “Jumbo loan balances” have seen a similar decrease, sitting at 3.4%.