Mortgage applications to purchase a home rose 3% last week from the prior week but surged 40% from a year ago, according to the Mortgage Bankers Association.
The Y-Y comparison is usually in single digits.
The Market Composite Index, a measure of mortgage loan application volume, increased 2.9% on a seasonally adjusted basis from 1 wk earlier. On an unadjusted basis, the Index increased 2% compared with the prior wk.
The Refinance Index increased 3% from the prior wk and was 60% higher than the same week 1 yr ago.
The seasonally adjusted Purchase Index increased 3% from 1 wk earlier. The unadjusted Purchase Index increased 0.2% compared with the prior wk and was 40% higher than the same week 1 yr ago.
Mortgage rates declined last wk, with a noteworthy 5-bpts decrease in the 15-yr 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
Purchase applications were 40% higher than the same wk 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.
Highlighting the strong overall demand for buying a home, conventional, VA and FHA purchase applications all increased last wk.
The refinance share of mortgage activity increased to 63.1% of total applications from 62.5% the prior wk. The ARM (adjustable-rate mortgage) share of activity decreased to 2.2% of total applications.
The FHA share of total applications remained unchanged remained unchanged from 10.2% the wk prior.
The average contract interest rate for 30-yr fixed-rate mortgages with conforming loan balances ($510,400 or less) decreased to 3.07% from 3.08%.
The average contract interest rate for 15-year fixed-rate mortgages decreased to 2.62% from 2.67%.
Have a healthy day, Keep the Faith!