Refinancing activity has stayed stronger than expected as rates remain low, a boon to consumer discretionary spending.
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The survey includes more than 75% of the retail residential mortgage apps in the USA according to the group. The unadjusted Purchase Index increased 20 percent compared with the previous week and was 27 percent higher than the same week one year ago.
“We’re not going in reverse, but we are hitting the brakes a bit in some markets”, Svenja Gudell, Zillow chief economist, said in the August report.
Also released this week was the Federal Housing Finance Agency’s monthly house price index.
The Market Composite Index, a measure of mortgage loan application volume, increased 13.9% on a seasonally adjusted basis from one week earlier.
Average fixed mortgage rates declined following the Federal Reserve’s decision to defer a hike in the Federal funds rate, according to Freddie Mac. Until this uneasiness is put to rest, don’t expect any sharp upward moves in mortgage rates.
Falling oil prices and China’s ongoing economic turmoil added to the demand for government bonds, MarketWatch reported Tuesday.
Meanwhile, the Zillow analysis indicates the rise in home prices is beginning to moderate. The 30-year fixed rate has remained below 4 percent for more than two months. Four weeks ago, the rate was 4.03%. This week’s rate is equal to the 52-week average.
The average contract interest rate for 15-year fixed-rate mortgages decreased to 3.31 percent from 3.33 percent, with points increasing to 0.42 from 0.26 (including the origination fee) for 80 percent LTV loans. In response, the interest rate on 30-year fixed rate mortgages dropped by 5 basis points to 3.86 percent. The short term, popular 15 year fixed rate loans at the bank are published at 3.21% and April of 3.392% today.
Apparently mortgage interest rates are down this week, which has resulted, of course, in an increase in applications by almost 14 percent. The seasonally adjusted purchase index rose by 9% compared with the week ended September 11.
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It’s common to see a surge in refinances around this time of year due to lower mortgage rates, says Michael Becker, branch manager at Sierra Pacific Mortgage in White Marsh, Maryland.
