Purchase Index on the Rise Despite Drop in Weekly Mortgage Application Volume

The weekly total mortgage loan application volume fell 3.3 percent, but luckily for home builders, the majority of the drop came from refinancing, according to a survey by the Mortgage Bankers Association (MBA). Applications for purchasing actually jumped 12 percent from the week before, possibly signaling that homebuyers are coming back to the market. As mortgage rates fell to a record low of 3.43 percent for a 30-year fixed rate loan, 10 of the largest states saw increases in purchasing activity, according to MBA’s vice president. Economic recovery from the coronavirus pandemic may still be an uphill battle, but uptick in applications signal that at least the housing market may make a comeback in the coming months. 

Weekly applications to purchase a home are on the rise, still recovering from a five-year year low hit during the coronavirus pandemic. 

The seasonally adjusted purchase index jumped 12% from one week earlier, according to data for the survey ending April 24 and released Wednesday by the Mortgage Bankers Association. Mortgage loan application volume fell 3.3% in the week, and the refinance index also fell 7%. 

The rosier survey data comes after a few weeks of falling applications, even as mortgage rates remain low, as the coronavirus pandemic and state lockdowns hindered consumers' ability to buy a home. In addition, eroded consumer sentiment may have put some homebuyer's plans on pause. 

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