Mortgage application activity surged last week — but that level of activity only helped it play catch-up, as it recovered by the amount it had dropped two weeks prior.
Overall, mortgage applications, reflecting both refinances and home purchases, accelerated 7.3 percent week to week, the Mortgage Bankers Association reports in its weekly mortgage market activity, reflecting the week ending Dec. 5.
The rise was driven by an increase in refinancing applications, which surged 13 percent last week, the same amount it had dropped the previous week. That puts refinancing application volume back where it was two weeks ago, CNBC reports.
Meanwhile, applications for home purchases, viewed as a leading indicator of future home sales, also are mostly in a holding pattern. Home purchase applications ticked up slightly at 1 percent from the previous week, but continue to be 4 percent lower than last year’s rate — just as last week’s report.
“You’re looking at the first time I can ever remember in the last 33 years where you had interest rates fall all year long in a up cycle, and mortgage purchase applications have had a negative year-over-year print every single week,” Logan Mohtashami, a loan officer with AMC Lending Group in Irvine, Calif., told CNBC.
The 30-year fixed-rate mortgage rose to 4.11 percent last week from 4.08 percent, according to the MBA’s report.
Source: “For Home Buyers, Mortgage Demand Is Locked at Lows,” CNBC (Dec. 10, 2014) and “U.S. Mortgage Applications Rise in Latest Week: MBA,” Reuters (Dec. 10, 2014)