Historic low rates mean mortgage activity continues to boom
The home buying and refinance boom isn’t likely to dip any time soon, thanks to historic low mortgage rates. According to the Mortgage Bankers Association Weekly Mortgage Application Survey, there was a 3.8% increase in mortgage applications on an adjusted basis from the previous week, with refinance activity continuing to fuel the influx of applications.
“The Refinance Index increased by 6% and was 88% higher than the same week one year ago,” said National Mortgage Professionals’ Navi Persaud. “The seasonally adjusted Purchase Index dipped 1% and was down 3% on an unadjusted basis. That being said, purchase activity is still 25% higher than in the same period in 2019.”
Joel Kan, MBA’s associate vice president of Economic and Industry Forecasting, agrees that rates continue to hover at record lows this fall. “The drop in rates spurred an uptick in demand for refinances,” he says. “Activity increased over 6 percent, with borrowers notably seeking conventional and government loans.
After a solid stretch of purchase applications growth, he says activity decreased for the fifth time in six weeks, but was still over 25 percent higher than a year ago, and has increased year-over-year for six straight months. 2020 continues to be a strong year for the housing market.