According to the latest Mortgage Bankers Association's [1] Weekly Mortgage Applications Survey, mortgage applications increased 30.2%. This report reveals statistics from the week ending on January 10 compared to the prior week.
Joel Kan, AVP of Economic and Industry Forecasting, commented on this positive showing to kick off the new year: "The mortgage market saw a strong start to 2020. Applications increased across the board, and the 30-year fixed mortgage rate hit its lowest level since September 2019.”
Kan then pointed to the statistics surrounding refinances, which also picked up steam: ”Refinances increased for both conventional and government loans, as lower rates provided a larger incentive for borrowers to act. It remains to be seen if this strong refinancing pace is sustainable, but even with the robust activity in the last two weeks, the level is still below what occurred last fall."
Kan said a possible reason for the increase is due to not only low rates but to a sold job market to “encourage prospective buyers to enter the market.”
"Homebuyers were active the first week of the year. Purchase activity was 8% higher than a year ago, and the purchase index increased to its highest level since October 2009,” Kan said.
The report revealed mortgage activity rose to 62.9% of total applications, up from the 58.9% that was posted just a week prior. The adjustable-rate mortgage (ARM) rose as well, accounting for 4.5% of the total applications. The FHA rose to 12.7%, while the VA fell, posting 12.1% of total applications. As for the USDA, its percentage of total applications remained static.
A report by the National Association of Home Builders [2] further broke down housing statistics, specifically zeroing in on regional activity and movement, their findings showing that in the year-to-date ending in November, single-family permits declined in the Northeast, the West, and the Midwest regions, while the South experienced an uptick.
Single-family housing permits over the first 11 months of 2019 reached 791,452—a decline of 1% from November 2018’s total of 799,679.