Mortgage demand in the U.S. saw a significant jump as consumers rushed to refinance amid falling interest rates, according to the latest weekly survey from the Mortgage Bankers Association (MBA).
- Total mortgage demand surged by 16.8% to reach its highest level since January 2023, driven largely by a sharp increase in refinancing activity.
Refinance demand soared, with the refinance index climbing to 889.3 for the week ending August 9th. This marks a 35% increase from the previous week and the highest level recorded since May 2022. The substantial jump reflects homeowners’ eagerness to lock in lower rates, as mortgage rates continue to trend downward.
- In addition to the spike in refinancing, purchase applications also saw an uptick for the second consecutive week. The purchase index rose by 2.8% to 137.7 for the week ending August 9th, the highest level in four weeks.
Mortgage rates fell by just one basis point to 6.54%, maintaining their position at a 16-month low following last week’s significant 27 basis point drop. The continued decline in rates has spurred activity in both the refinance and purchase markets, as consumers take advantage of the more favorable borrowing conditions.
The surge in mortgage demand, particularly in the refinancing sector, highlights the sensitivity of the market to rate movements. As mortgage rates remain at their lowest levels in over a year, the trend is likely to continue, with more homeowners and potential buyers looking to capitalize on the current rate environment.
