Purchase applications surge 6% as rates climb

"Purchase applications picked up almost 6% over the week to the strongest pace since September, despite mortgage rates increasing slightly, with the 30-year fixed rate rising to 6.34%, said Joel Kan, MBA's vice president and deputy chief economist. Purchase applications for conventional, FHA and VA loans increased, as potential homebuyers continue to shop around, particularly in markets where inventory has increased and sales price growth has slowed."

"Added Kan, Higher mortgage rates did quell some refinance activity, as conventional and VA refinance applications declined over the week, and the average loan size for refinances dropped to its lowest level in over a month. The refinance index decreased 3% from the previous week and was 147% higher than the same week one year ago. The refinance share of mortgage activity decreased to 55.6% of total applications from 57.0% last week."

The seasonally adjusted purchase index increased 6% week-over-week, and the unadjusted purchase index rose 3% from the prior week and 31% year-over-year. Purchase applications strengthened almost 6% to the strongest pace since September, while conventional, FHA and VA purchase applications all increased as buyers shopped more in markets with rising inventory and slowing price growth. Higher mortgage rates reduced some refinance activity: conventional and VA refinances declined and average refinance loan size fell to its lowest level in over a month. The refinance index fell 3% week-over-week but remained 147% higher year-over-year. Refinance share declined to 55.6% and ARM share to 7.8%. FHA share rose to 19.4%, VA share fell to 14.8%, and USDA share fell to 0.2%. Conforming 30-year rates increased to 6.34% and jumbo rates to 6.46%.

Read at www.housingwire.com