Mortgage application volume jumped 7.2% during the week ended Jan. 24, according to the Mortgage Bankers Association’s Weekly Applications Survey.
The results include an adjustment for the Martin Luther King Jr. Holiday.
Applications for refinances increased 8% compared with the previous week while applications for purchases increased 5%.
The 7.2% increase follows a slight decrease in total volume the previous week.
Helping to drive the increase was a drop in the average rate for a 30-year fixed rate mortgage, which fell to 3.81%, down from 3.87% the previous week.
“Mortgage applications continued their strong start to the year, as borrowers acted on the drop in mortgage rates last week,” says Joel Kan, associate vice president of economic and industry forecasting for the MBA, in a statement. “Rates were driven lower by investors’ increased concern about the economic impact from China’s coronavirus outbreak, in addition to existing concerns over trade and other geopolitical risks.”
On an unadjusted basis, total volume decreased 1% compared with the previous week.
Applications for purchases increased 2% on an unadjusted basis and were 17% higher compared with the same week one year earlier.
“Thanks to low rates and the healthy job market, purchase activity continues to run stronger than in 2019,” Kan says.
The refinance share of mortgage activity decreased to 60.4% of total applications, down from 61.6% the previous week.
The adjustable-rate mortgage (ARM) share of activity increased to 4.7% of total applications.