Purchase applications rising

Purchase applications rising

More people are securing mortgages for their eventual relocation into a new home.

The number of applications from mortgage borrowers who were looking to purchase a new home increased 6.3 percent from the previous week, reported the Mortgage Bankers Association. More purchase applications came even as the MBA reported rising interest rates.

The MBA's vice president of research and economics Michael Fratantoni pointed out that purchasing activity still remains almost 40 percent below levels seen one year ago. Even so, it was positive news given that purchase applications have now increased for two consecutive weeks on a seasonally-adjusted basis.

Purchasing activity has not been this high since May, when many buyers were moving into new homes, spurred by the federal homebuyer tax credit. Purchase applications fell off significantly after that, mirroring drops in home sales. According to the National Association of Realtors, pending home sales have fallen steadily since the expiration of the tax credit on April 30.

Pending home sales did rebound in July, increasing 5.2 percent, according to the most recent NAR report. That might foretell increased moving activity in the near future.


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