Mortgage rates for all types of loans were down last week according to the Mortgage Bankers Association® Weekly Applications Survey. The drop in mortgage rates follows 4 straight weeks of rate increases. Even with the lower rates, findings show demand for loans to purchase homes for sale and condos for sale was down from the previous week.
Furthermore, the Refinance Index fell 5 percent and the Purchase Index (a leading indicator for future home sales) dropped 1 percent. However, the Purchase Index remains 24 percent higher than it was during the same period 12 months ago.
MBA’s chief economist, Michael Fratantoni spoke to CNBC and indicated demand for more expensive homes is continuing to outpace mortgage applications for more affordable properties. Mr. Fratantoni said, “Average purchase loan size climbed to a new survey high last week, as the higher end of the market continues to grow more quickly than the entry level.”
The MBA weekly surveys 75 percent of mortgage applications for residential purchases and has conducted this survey since 1990.
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