Mortgage Demand Rises Week-Over-Week

According to the Mortgage Bankers Association’s Weekly Applications Survey, demand for mortgage loan applications rose 1.2 percent last week from the week before. But while the improvement is a welcome sign, it wasn’t due to an increasing number of Americans buying homes. Instead, the gains were mostly found in the refinance index, which rose 4 percent from one week earlier. Joel Kan, MBA’s associate vice president of economic and industry forecasting, says purchase-application demand is still suffering due to a lack of available homes for sale. “A decline in purchase applications was seen for both conventional and government loans,” Kan said. “There continues to be strong demand for buying a home, but persistent supply shortages are constraining purchase activity, and building material shortages and higher costs are making it more difficult to increase supply.” Also in the report, average mortgage rates were up from the week before, with increases seen for 30-year fixed-rate loans with both conforming and jumbo balances, loans backed by the FHA, and 15-year fixed-rate loans. Still, rates remain below where they were in late March and early April. (source)

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