Demand For Home Purchase Loans Increases
According to the Mortgage Bankers Association's Weekly Applications Survey, demand for loans to buy homes increased last week for the first time in more than a month. The improvement was slight and, when combined with a 4 percent drop in refinance activity, meant the MBA's Market Composite Index – which measures overall mortgage demand – was virtually unchanged from the previous week. Joel Kan, MBA's vice president and deputy chief economist, says demand remains low. “Purchase applications increased for the first time after six weeks of declines but remained close to 2015 lows, as home buyers remained sidelined by higher rates and ongoing economic uncertainty,” Kan said. “Refinances continued to fall, with the index hitting its lowest level since August 2000.” That demand has slowed isn't surprising, especially since mortgage rates continue to climb. Last week, rates were up across most loan categories, including 30-year fixed-rate loans with conforming balances, loans backed by the Federal Housing Administration, 15-year fixed-rate loans, and 5/1 ARMs. The MBA's weekly survey has been conducted since 1990 and covers 75 percent of all retail residential mortgage applications.