Mortgage Demand From Homebuyers Shows Unexpectedly Strong & Quick Recovery
Mortgage applications to purchase a home also rose 9% last week from the previous week, according to the Mortgage Bankers Association.
That is the sixth consecutive week of gains and a 54% jump since early April.
Refinance volume has not been as strong. Those applications fell 0.2% for the week but were still 176%.
It’s not as if the coronavirus pandemic has gone away, but after a sharp pullback, homebuyers are now piling back into the housing market much faster than expected.
Mortgage applications to purchase a home rose 9% last week from the previous week and from a year earlier, according to the Mortgage Bankers Association’s seasonally adjusted index. It was the sixth straight week of gains and a 54% recovery since early April.
“The home purchase market continued its path to recovery as various states reopen, leading to more buyers resuming their home search,” said Joel Kan, an MBA economist. “Additionally, the purchase loan amount has increased steadily in recent weeks and is now at its highest level since mid-March.”
The gain mirrors an unexpectedly strong sales pace just reported for newly built homes in April. They were forecast to fall 22% but instead rose nearly 1% for the month, according to the U.S. Census. Buyers are rushing into the new home market, as the supply of existing homes keeps falling to new record lows. Some analysts also believe there is now a flight from urban downtowns, where people have been sheltered in small apartments, to suburban markets, where they can find more space, especially backyards and home offices.