Mortgage applications slip despite high affordability – Santa Monica Real Estate
Increasing home prices may be preventing some prospective buyers of homes for sale in Los Angeles County and surrounding areas from purchasing, while mortgage rates linger near record low levels.
The most recent Mortgage Banker’s Association’s Weekly Mortgage Applications Survey reveals activity fell just 0.2 percent from the previous week. On an unadjusted basis, the Market Composite Index was up 24 percent, including the Labor Day holiday.
Additionally, the seasonally adjusted Purchase Index fell 4 percent from the week prior and was up on an unadjusted basis by 18 percent when compared to the previous week. It was also 8 percent higher than this time last year.
While fewer potential buyers are applying for mortgages, current homeowners continue to take advantage of low mortgage rates. The Refinance Index increased 1 percent from the week before, while refinances continued to make up majority of applications. Current homeowners accounted for 81 percent of all applications, up from 80 percent last week.
Home prices have been steadily increasing in Southern California, as the number of delinquent properties listed for sale has fallen greatly.