Mortgage Applications Fall, But Why?

     As I have been stating numerous times in my previous posts, buyer activity has been going up and up and up. More and more buyers are coming out every week which has brought up the dilemma of very high demand (buyers) and very low supply (sellers). With all of these buyers coming out you would assume that the Mortgage applications would be going up due to more people purchasing homes...and you would be right and wrong. Mortgage applications for home purchases (which is a leading indicator of home sales) are up 1.4%, however mortgage applications for refinancing home loans are down 5.6%. The amount that the refinancing applications decreased offset the increase in the amount of applications for mortgages on home purchases. That is why, according to the Mortgage Bankers Association, the overall figure for mortgage applications has decreased by 4% for the week ending on March 29. This is good news for the real estate industry because if less people are refinancing it means that less people are considering staying in their home as opposed to moving to another home; more moving means more activity in the real estate market. Refinancing loans have accounted for 74% of total mortgage applications which is down from the previous weeks number of 75%. Also, the fixed 30-year mortgage rate has dropped 3 basis points from 3.79% to 3.76%. These are just some more strong signs of a solid recovery in progress!