Home buyers are reemerging, and here’s the proof: Mortgage applications to purchase a home reached the highest volume in more than 11 years. Record low mortgage rates are tempting more buyers into the market.
Mortgage applications to purchase a home are 21% higher than the same week a year ago, the Mortgage Bankers Association reports. Applications for home purchases ticked up 4% week over week.
“The housing market continues to experience the release of unrealized pent-up demand from earlier this spring, as well as a gradual improvement in consumer confidence,” said Joel Kan, the MBA’s economist.
Record low mortgage rates certainly are helping. The MBA reports the average contract interest rate on a 30-year fixed-rate mortgage dropped from 3.38% to 3.30% last week.
More homeowners are taking advantage of the lower rates. Refinance applications last week increased by 10% during the week and are 106% higher than a year ago. “Refinancing continues to support households’ finances, as homeowners who refinance are able to gain savings on their monthly mortgage payments in a still-uncertain period of the economic recovery,” Kan said.