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The spring creep has turned into the spring sprint as the winter blues that usually plague the housing industry are nowhere to be found. Last week’s total mortgage application volume soared over 30 percent from the prior week, and refinancing rose 43 percent as well, which is 109 percent higher year-over-year. Even more exciting for builders: Overall purchase mortgage activity is the highest it has been since October of 2009. This is a strong start to January 2020, and as the homebuying season ramps up, odds are it will keep climbing through spring.
It was a seriously strong start to 2020 in the mortgage business for new home loans and refinances.
Total mortgage application volume surged 30.2% last week from the previous week, according to the Mortgage Bankers Association’s seasonally adjusted index.
Refinancing led the surge, thanks to a drop in mortgage rates. Those applications jumped 43% for the week and were 109% higher than a year ago. The refinance share of mortgage activity increased to 62.9% of total applications from 58.9% the previous week.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($510,400 or less) decreased to the lowest level since September, 3.87%, from 3.91%, with points decreasing to 0.32 from 0.34 (including the origination fee) for loans with a 20% down payment. The rate was 87 basis points higher the same week one year ago.
