In August of 2015, 84% of purchase mortgage applications in Mortgage Bankers Association’s Weekly Application Survey were for loans less than $417,000, the conforming loan limit in many geographies.
“Loans between $150,000 and $300,000 in size comprised the largest group at 39% of the application count, with even smaller loans accounting for 30% of volume,” say Lynn Fisher and Joel Kan at MBA.
Compared to August a year ago, the number of applications for mortgages greater than $417,000 grew by 37%, they note.
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“While growth in jumbo markets has been the stuff of headlines, the number of applications for loans between $300,000 and $417,000 grew by 34% over the last year,” they say. “For applications between $150,000 and $300,000, the rate was 23%.”
Growth in applications for the smallest loan sizes was slow to appear in 2015 but continued on a slight positive trend in August, growing 3% relative to a year ago.
“We expect further normalization of housing demand next year,” they say.