Mortgage application Jumps by 7% Reaching a Six month ATH
The Mortgage Bankers Association announced that mortgage applications increased 7 percent in the week ending September 3rd, which was 11% lower than the same time last year. This is a modest decline from a 14-week drop, but it nevertheless lags behind its previous annual high in April, when 12 percent fewer individuals took out loans during these two months relative to 2013. Further suggesting they may be taking out loans later on because there are more expensive interest rates at present due to recent hikes by major banks like JP Morgan Chase (JPM). The jump seen last week was attributed not only thanksgiving holiday weekend which slowed down borrowing activity both domestic as well international; however also adjustments were made where individual employers had different start/finish times between Monday evening.
The Housing Market Effect
The housing market is back! It’s not just the start of fall, it’s also an opportunity to buy a home. With more inventory and competition at its lowest point in years- this might be your chance while prices are still affordable for most buyers
The pandemic may have slowed things down but there seems now to be hope on America’s horizon with everyone from first time homeowners all the way up through investors looking forward towards vacancy rates declining even further (and hopefully staying low).
With so few houses for sale, buyers have grown increasingly irritated in their search. However, as inventory levels rise and prices continue to climb at unprecedented rates, the situation is improving. Recent purchase mortgage applications made with ease are an indication of this!
We’ve reached a point where the rate at which we’re selling houses has slowed significantly enough that it isn’t impeding people from obtaining what they want; instead, these fortunate few will be able to live large in one or two properties rather than having numerous scattered throughout town.
The housing market is extremely competitive, and home prices continue to rise. This surge in demand for mortgage loans has been driven by both conventional and government purchases!
Mortgage Rate Fluctuations
Despite the fact that mortgage rates have risen, home refinancing applications were down 3% last week and lower than a year ago. After the average rate reached its highest level around this time last year, many individuals will simply wait until their current loan comes up or get another offer before applying again so they may maintain flexible options available if needed because of interest costs.
The mortgage rate remained at a historical low this week, with the typical contract interest for 30-year fixed mortgages with conforming loan balances of $548250 or less dropping to 3.03 percent from 3.07 percent last week. Loans are made less expensive and faster, with a typical duration of 4.9 years in the third quarter of 2018 (as opposed to 5.0 years in Q2 2017). Loan sizes have shrunk slightly, too, now coming in at $500k instead of $600k. Origination fees have also decreased significantly -down by about 10%. The refinance share went down again , 66%, but that may not be all due to recent changes made within Fannie Mae (that will soon go back under government control).
