National Real Estate - Purchase Applications Increase As Market Remains Affordable



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Purchase Application Increase As Market Remains Afforable

 
As home prices continue to improve along with mortgage rates, there has been less mortgage application activity in recent weeks. However, affordability remains high, as both prices and rates remain significantly lower than this time last year, driving higher purchase levels.

Wednesday, October 24th, 2012

 

As home prices continue to improve along with mortgage rates, there has been less mortgage application activity in recent weeks. However, affordability remains high, as both prices and rates remain significantly lower than this time last year, driving higher purchase levels.

The Mortgage Bankers Association's Weekly Mortgage Applications Survey for the week ending August 24 shows activity slipped 4.3 percent from one week earlier, while it was also down on an unadjusted basis by 5 percent.

According to the report, the seasonally adjusted Purchase Index increased more than 1 percent. Those who are already homeowners have been less active when it comes to refinancing their current mortgage, as the Refinance Index fell 6 percent from the previous week, reaching its lowest level since May 11.

While refinances have continually accounted for the majority of all application activity, it dropped slightly to make up 79 percent of all applications from 80 percent reported the week before. Homeowners and those refinancing have expressed interest in adjustable-rate mortgages, as the share of activity for ARMs increased to include 4 percent of application activity.

Higher home prices may make purchasing a home slightly less affordable, but prospective buyers are advised to begin their home search soon, as both prices and mortgage rates are expected to continue rising in 2012. Potential buyers should also understand that these growing numbers are indicative of a stabilizing housing market, which benefits both buyers and sellers.

National real estate trends have a major impact on the real estate market on a daily basis. Keeping up-to-date on the latest news and notes posted by GL Homes can make sure those looking for South Florida homes know exactly how the current market will affect them.