Mortgage demand continues to climb as a buying frenzy extends beyond traditional seasonal patterns in real estate. Mortgage applications to purchase a home are now 25% higher than a year ago, the Mortgage Bankers Association reports.
Home sales are strongest on the high end of the market, where inventory is loosest, the National Association of REALTORS® reports. In August, the supply of homes worth more than $1 million was 44% higher than the year prior. Homes over $250,000 are also seeing more growth now than a year ago. Homeowners are looking to buy larger spaces to accommodate remote work, a pattern that “will be in place long after the pandemic is over,” NAR Chief Economist Lawrence Yun told CNBC.
Prices for existing homes hit another record high in August, climbing 11.4% year over year to a median of $310,600, NAR reports. Prices rose in every region of the U.S. last month.
“The demand for higher-balance loans pushed the average purchase loan size to another record high,” says Joel Kan, MBA’s economist. “The strong interest in home buying observed this summer has carried over to the fall.”