Mortgage Applications Increase
The Mortgage Bankers Association released a survey that indicated mortgage applications ticked up for the week ending April 3. Job growth, historically low mortgage rates and economic stability may have contributed to the spike in total applications.
Increasing Interest in Homeownership
The number of individuals deciding to invest in real estate increased again. The MBA's survey showed a 0.4 percent jump on a week-over-week basis when seasonally adjusted. When unadjusted the number of applications increased by 1 percent when compared to the previous week.
One of the leading indicators of total home sales, the Purchase Index, ticked up by 7 percent from the week before and 12 percent year over year. These results from the data collected and presented in MBA's survey express the potential of a strong spring season for real estate and a continually strengthened housing market. Additionally, these increases have continually occurred further indicating a healthy market.
"Purchase mortgage application volume last week increased to its highest level since July 2013, spurred on by still low mortgage rates and strengthening housing markets," said MBA's Chief Economist Mike Fratantoni. "Purchase volume has increased for three straight weeks now on a seasonally adjusted basis."
Of the total number of loan applications, 13.2 percent were through the Federal Housing Administration and 10.7 percent were Veteran Affairs loans. Both of these types of loans saw an increase in the number of applications from the previous week.
Signs For a Healthy Spring
With more people applying for home loans, a higher volume of individuals will likely want to purchase new homes. A heightened demand for real estate options bode well for the future of the market.
The jump in applications and interest in investing in homes may be encouraged by the job growth and low mortgage rates seen recently. When individuals feel confident about their financial situation, they are more likely to commit to larger purchases, such as a new house.
Due to the higher interest in owning a home,this upcoming season will likely be a seller's market.
Buying a Home in a Seller's Market
If you are considering purchasing a new home this spring, realtor.com recommended a few tips to help ensure you make the best decision and wind up with the perfect home. When more people are interested in buying homes, available options might be more slim and your offer may need to be stronger.
Recruit the help of a real estate agent to help you navigate through the process and consider looking at newly-constructed homes as well.