Driven mainly by a surge in refinance activity, mortgage application volume jumped 9.6% on an adjusted basis during the week ended Nov. 8, according to the Mortgage Bankers Association’s (MBA) Weekly Applications Survey.
Applications for refinances increased 13% while applications for purchases increased 5%.
Compared with a year earlier, applications for refinances were up 188%.
“Mortgage applications increased to their highest level in over a month, as both purchase and refinance activity rose despite another climb in mortgage rates,” says Joel Kan, associate vice president of economic and industry forecasting for the MBA, in a statement. “Positive data on consumer sentiment, and growing optimism surrounding the U.S. and China trade dispute, were behind last week’s rise in the 30-year fixed mortgage rate to 4.03 percent.”
Kan says he expects to see moderate growth in refinance activity in the weeks to come, as rates are expected to remain stable.
As far as purchase activity goes, “Last week was a solid week for homebuyers,” he says.
“Purchase applications increased two percent and were 15 percent higher than a year ago,” Kan says. “Low supply and high home prices remain a key characteristic of this fall’s housing market, which is why the largest growth in activity continues to be in loans with higher loan balances.”
The refinance share of mortgage activity increased to 61.9% of total applications, up from 59.5% the previous week.
The adjustable-rate mortgage (ARM) share of activity decreased to 4.9% of total applications.
The average rate for a 30-year fixed-rate mortgage was 4.03%, up from 3.98% the previous week.