With home purchases reaching a five-month high and refinancing increasing, mortgage applications increased in the week ended June 8, driving up the Mortgage Bankers Association’s index of applications to buy a home or refinance a loan by 6.6 percent, according to Bloomberg News.
Purchase applications and applications for refinancing – the component parts of the index – increased 7.2 percent and 5.6 percent, respectively.
“Housing demand is in the process of stabilizing,” said Robert Stein, a senior economist at First Trust Advisors LP in Lisle, Ill. “We have substantial employment growth that will support the ability to make purchases. The drag from housing is coming down.”
The purchase index stood at 464.7 last week, the highest level since January and 12 percent higher than in the same period a year ago. The refinancing index increased to 1,854.8, 23 percent higher than the year-ago level.
Adjustable-rate mortgages increased to 18.7 percent of all mortgage applications last week from 17.8 percent the prior week, while the share of all applications that were for refinanced loans held steady at 38 percent.
The average rate on a 30-year, fixed mortgage increased to 6.61 percent, a 0.26 percentage point increase from the prior week and the largest increase since April 2004.
The Mortgage Bankers Association represents the real estate finance industry, with a membership of more than 3,000 companies employing more than 500,000 people. For more information, visit www.mortgagebankers.org.
