NEW YORK (Reuters) - Applications to U.S. lenders seeking loans to buy a home climbed to their highest level in almost nine years last week even as mortgage rates increased for a second week, the Mortgage Bankers Association said on Wednesday.
The Washington-based group’s seasonally-adjusted barometer on purchase mortgage activity, which is seen as a proxy on future housing activity, edged up 0.9% to 280.7 in the week of April 12, marking its strongest reading since 291.3 in the week of April 30, 2010.
(GRAPHIC: U.S. mortgage applications - tmsnrt.rs/2RnEpRD)
“The spring buying season continues to be robust, with activity more than 7% higher than a year ago and up year-over-year for the ninth straight week,” Joel Kan, MBA’s associate vice president of economic and industry forecasting, said in a statement.
The latest pickup in loan requests for home purchases has not been hampered by the uptick in borrowing costs.
Interest rates on conforming 30-year mortgages, with loan balances of $484,350 or less, averaged 4.44% last week, up 4 basis points from the prior week, MBA said.
Other mortgage rates MBA tracks on average increased anywhere from 1 basis points to 10 basis points.
Home loan rates rose in step with rising bond yields, as investors pared their bond holdings on less dismal data from China, Europe and the United States.
On the other hand, refinancing applications fell 8.2% to 1,453.0 in the last week on a seasonally adjusted basis, MBA said.
The refinancing index reached its highest level since November 2016 two weeks earlier at 1,786, when mortgage rates fell to their lowest levels in over 14 months.
The share of refinancing requests versus total applications shrank to 41.5% from 44.1% the week before.
MBA’s seasonally adjusted gauge on overall mortgage application activity decreased 3.5% to 459.0 in the latest week. It retreated further from a 2-1/2 year peak set two weeks ago.
MBA’s weekly survey, which began in 1990, covers more than 75% of all U.S. retail mortgage applications.
Reporting by Richard Leong, Editing by Franklin Paul and Nick Zieminski