Mortgage applications for home purchases increased 11 percent last week, the latest sign that the housing market is taking early steps forward during the coronavirus pandemic.
The Mortgage Bankers Associations Weekly Mortgage Applications Survey released Wednesday found that the number of purchase applications was 10 percent lower than the same week a year ago.
Overall, total mortgage applications – including refinancing – increased 0.3 percent from a week earlier.
“We expect this positive purchase trend to continue – at varying rates across the country – as states gradually loosen social distancing measures, and some of the pent-up demand for housing returns in what is typically the final weeks of the spring home buying season,” said Joel Kan, MBA’s Associate Vice President of Economic and Industry Forecasting.
York – after a 9 percent gain two weeks ago – led the increases with a 14 percent jump. Illinois, Florida, Georgia, California and North Carolina also had double-digit increases last week, Kan said.
The refinance share of mortgage activity decreased to 67 percent of total applications from 70 percent the previous week. The adjustable-rate mortgage (ARM) share of activity decreased to 2.9 percent of total applications.
“Mortgage rates stayed close to record-lows, but refinance applications decreased for the fourth consecutive week, driven by a 5 percent drop in conventional refinances,” Kan said. “Despite the downward trend over the last month, mortgage lenders remain busy. Refinance activity was up 200 percent from a year ago.”