U.S. mortgage applications for new home purchases rose in August and a significant number originated from Florida. The MBA said that applications increased 6.8% during the month compared to year-ago levels and 7% compared to July.
These include mortgage loans in Fort Myers and other areas in the state. New mortgages from Texas and those in Florida accounted for more than 30% of all applications in August.
Lynn Fisher, MBA vice president of research and economics, said that lower interest rates and higher prices for existing homes drove the increase in applications. Conventional loans represented the lion’s share of financing types for home purchases with 71.9% of applicants. FHA loans accounted for 14.4%, followed by 12.7% of VAs and 0.9% of RHS/USDA loans.
However, Fisher noted that Hurricanes Harvey and Irma may or may not affect the pace of housing starts in Florida and Texas. It is likely that new home sales may become delayed in terms of the groundbreaking aspect, she added. Still, the MBA recorded a continual increase in mortgage applications coming into September.
During the first week of September, total mortgage application volume rose almost 10% year over year, as buyers rushed to take advantage of low rates, according to the MBA’s seasonally adjusted weekly index.
Since the 2016 election, rates continued to drop particularly for 30-year fixed loans that had lower interest by 3 percentage points, MBA economist Joel Kan said. A 30-year fixed mortgage, with conforming loan balances of at least $424,100, had a 4.03% average contract interest rate in the first week of September.
Rising home prices partly served as one reason behind the growth of mortgage applications in the U.S., yet attractive interest rates seem to be their main reason for taking out loans. Talk to a trusted loan provider to learn more about your financing options and the market.