Six weeks ago, mortgage applications for home purchases were down 35 percent annually, but demand is roaring back. Purchase volume jumped 6 percent and now hovers just 1.5 percent below last year’s levels, according to the Mortgage Bankers Association’s seasonally adjusted index. A rise in home purchases may be coming our way, especially because refinance applications are actually down. Though the mortgage applications may not be sales, they are likely to lead to them, a hopeful sign in a difficult time.
If mortgage demand is an indicator, buyers are coming back to the housing market far faster than anticipated, despite coronavirus shutdowns and job losses.
Mortgage applications to purchase a home rose 6% last week from the previous week, according to the Mortgage Bankers Association’s seasonally adjusted index. Purchase volume was just 1.5% lower than a year ago, a rather stunning recovery from just six weeks ago, when purchase volume was down 35% annually.
“Applications for home purchases continue to recover from April’s sizable drop and have now increased for five consecutive weeks,” said Joel Kan, an MBA economist. “Government purchase applications, which include FHA, VA, and USDA loans, are now 5 percent higher than a year ago, which is an encouraging turnaround after the weakness seen over the past two months.”