The Mortgage Bankers Association has released its application volume numbers, which show a strong rebound in both purchase and refinance application activity. Purchases jumped 7.2 percent and refis jumped 5.6 percent from one week earlier:
The Market Composite Index, a measure of mortgage loan application volume, was 666.5, an increase of 6.6 percent on a seasonally adjusted basis from 625.3 one week earlier. On an unadjusted basis, the Index increased 17.4 percent compared with the previous week and was up 16.1 percent compared with the same week one year earlier. The Refinance Index increased 5.6 percent to 1854.8 from 1757.1 the previous week and the seasonally adjusted Purchase Index increased 7.2 percent to 464.7 from 433.6 one week earlier. The seasonally adjusted Conventional Index increased 6.4 percent to 979.1 from 920.6 the previous week, and the seasonally adjusted Government Index increased 9.3 percent to 145.2 from 132.8 the previous week.
This jump is somewhat counterintuitive, given that rates have been on the rise pretty consistently, but a Bloomberg piece says buyers are jumping in before rates get even higher:
The biggest jump in fixed-mortgage rates in three years may have lured some buyers into the market to take advantage of lower home prices before rates go up even more. Increasing jobs and wages are given owners the wherewithal to buy, signaling housing may be less of a restraint on the economy. “Housing demand is in the process of stabilizing,” said Robert Stein, a senior economist at First Trust Advisors LP in Lisle, Illinois. “We have substantial employment growth that’ll support the ability to make purchases. The drag from housing is coming down.”
I’m not sure how Robert Stein was able to extrapolate from mortgage app volume to housing stability. That seems like a mighty leap to me.