According to the Mortgage Bankers Association’s Weekly Applications Survey, average mortgage rates increased last week for 30-year fixed-rate loans with conforming balances, loans backed by the Federal Housing Administration, and 15-year fixed-rate loans. It was the third consecutive week rates have increased. But despite rising rates, home buyers remained active. In fact, the MBA’s Purchase Index was up 5 percent from one week earlier. Joel Kan, MBA’s associate vice president of economic and industry forecasting, says most of the activity came from buyers of newer, more expensive homes. “Despite higher mortgage rates, purchase applications had a strong week, mostly driven by a 6 percent increase in conventional loan applications,” Kan said. “As home-price appreciation continues at a double-digit pace, buyers of newer, pricier homes continue to dominate purchase activity, while the share of first-time buyer activity remains depressed.” The MBA’s weekly survey has been conducted since 1990 and covers 75 percent of all retail residential mortgage applications. (source)
Home Buyers Active Despite Rising Rates
