By Jim Perskie
Applications for mortgages for home purchases increased for the fifth straight week as the housing market continues to make tentative steps forward amid the coronavirus pandemic, the Mortgage Bankers Association announced Wednesday.
MBA’s Weekly Mortgage Applications Survey showed that the Purchase Index for the week ending May 15 increased 6 percent over a week earlier, though it was slightly lower than a year ago.
“Applications for home purchases continue to recover from April’s sizeable drop and have now increased for five consecutive weeks. Purchase activity – which was 35 percent below year-ago levels six weeks ago – increased across all loan types and was only 1.5 percent lower than last year,” said Joel Kan, MBA’s Associate Vice President of Economic and Industry Forecasting.
The survey found:
- Overall, mortgage applications decreased 2.6 percent from a week earlier.
- The Refinance Index decreased 6 percent from the previous week but was 160 percent higher than a year ago.
- The refinance share of mortgage applications decreased to 65.3 percent of applications, down from 67 percent the previous week.
- The adjustable-rate mortgage share of activity increased to 3.2 percent of applications.
“Despite mortgage rates remaining close to record-lows, refinance activity slid to its lowest level in over a month,” Kan said. “The average loan amount for refinances fell to its lowest level since January – potentially a sign that part of the drop was attributable to a retreat in cash-out refinance lending as credit conditions tighten. We still expect a strong pace of refinancing for the remainder of the year because of low mortgage rates.”