US Homebuyers Strong Mortgage Demand

Homebuyers in the US are back in the housing market much faster than expected. Mortgage applications to purchase a home rose 9% last week from the previous week and from a year earlier, according to the Mortgage Bankers Association’s seasonally adjusted index. It was the sixth straight week of gains and a 54% recovery since early April. The gain reflects the unexpectedly strong sales for newly built homes in April. They were forecast to fall 22% but instead rose nearly 1% for the month, according to the U.S. Census. Buyers are rushing into the new home market, as the supply of existing homes keeps falling to new record lows. Buyers were also helped by near record low mortgage rates. The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances of $510,400 or less increased to 3.42% from 3.41%.