Refinances Drop, Buys Increase

Mortgage Rates Increase, But So Do Buyers

In mid-March, mortgage rates hit their highest averages in the last calendar year. The increase in these rates is being fueled by a healthier economy overall, and ultimately bodes well for the housing market. Higher rates did, however, affect the number of people applying for a mortgage, according to the Mortgage Bankers Association.

According to the weekly index they release, the total amount of mortgage applications (i.e. those to purchase a home and to refinance) dropped by 1.3 percent. This decrease does not show that interest in buying a home is slowing, though. In fact, the drop was largely due to a decrease in the number of people refinancing their mortgage, which decreased by 3 percent. As a result of this drop, the number of refinances dropped to its lowest level since the beginning of the year.

Even as the number of homeowners trying to refinance decreases, applications to buy a home increased by 2 percent. The majority of these future buyers are hoping to get into high-end homes, as is indicated by the fact that the average loan size for those hoping to buy was $294,000. This is the highest size ever recorded.

This high-end loan amount indicates that the majority of buyers are current homeowners hoping to upgrade rather than first-time home buyers making the switch from renting to becoming homeowners.

The number of buyers is increasing because this is a great time to get into your dream home. To take advantage of the ideal mortgage market we are currently experiencing, contact Avis Lending today. We have locations in Irvine, California and Lahaina, Hawaii and are here to act as your guide to the West Coast home loan you need to get the keys to your forever home this year.

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