Mortgage rates have set record levels more than a dozen times this year, and last week there was another. This led to an increase in the volume of mortgage applications by 3.9% compared to the previous week, according to the seasonally adjusted index of the Association of Mortgage Bankers.
Refinancing applications led, rising 5% for the week to the highest rate since last April. The volume is 79% higher than the same week a year ago. The share of mortgage refinancing has increased to 71
The average agreed interest rate for 30-year fixed-rate mortgages with corresponding loan balances ($ 510,400 or less) decreased to the survey level of 2.92% from 2.99%, with points falling to 0, 35 of 0.37 (including origin tax) for loans with 20% down payment.
“Weekly mortgage volatility has resurfaced as markets respond to fiscal policy uncertainty and the resurgence of Covid-19 cases across the country,” said Joel Kahn, MBA’s associate vice president of industry and economic forecasting.
While more than 4 million borrowers have already refinanced their home loans so far this year, more than 19 million can still save significantly on their monthly refinancing payments, according to a recent estimate by Black Knight, a mortgage technology and data provider. Today’s average mortgage rate is about a percentage point lower than it was a year ago.
Home buyers also receive an additional incentive from today’s prices, despite the sharp rise in house prices. Mortgage applications for home purchase increased by 4% for the week and were 19% higher than the same week a year ago.
“Against the backdrop of strong competition for limited supply of homes for sale, as well as rapidly rising house prices, purchase orders have increased for both conventional and government borrowers. In addition, purchasing activity has exceeded previous year’s levels by more than six months, “Kahn said.