The latest statistics show people in the housing market have decided to go big in order to go home.
The size of loans that people are seeking is near record highs.
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Overall, demand for mortgage applications declined 3.9% from the prior week as mortgage rates increased, according to the latest survey from the Mortgage Banker’s Association.
The seasonally adjusted Purchase Index decreased 1% from one week earlier.
HOME PRICES HIT NEW ALL-TIME HIGHS
“Despite a second-straight weekly decrease, average loan sizes remain close to record high,” said Joel Kan, MBA’s associate vice president of economic and industry forecasting. “This is a continuing sign that sales prices are still elevated, driven by stiff competition leading to accelerating home-price growth.”
The Refinance Index decreased 5% from the previous week and was 8% lower than the same week one year ago.
“Mortgage rates were at their highest levels in around a month, with the 30-year fixed rate increasing above 3% to 3.06%,” said Kan. “Mortgage rates followed an overall increase in Treasury yields last week, which started higher from the strong July jobs report before slowing because of weaker consumer sentiment and concerns about rising COVID-19 cases.”
The survey covers over 75% of all U.S. retail residential mortgage applications and has been conducted weekly since 1990.