NEW YORK — Americans applied to buy homes at the highest pace last week since May, but more than 8 of every 10 loan requests was for a refinancing, Mortgage Bankers Association data show on Wednesday.
August employment and July pending home sales surpassed forecasts and could portend a rise in deeply depressed home sales, economists said.
Still, about 82 percent of all loans last week were for refinancings rather than purchases, with unemployment still high at 9.6 percent and the U.S. housing market groping for a bottom.
Total loan requests fell by a seasonally adjusted 1.5 percent last week, as refi demand dropped 3.1 percent from the highest levels since May 2009. Home purchase applications rose 6.3 percent.
Home buying demand climbed back to levels seen in late May but stayed almost 40 percent lower than a year ago, said Michael Fratantoni, MBA’s vice president of research and economics.
“On the other hand, refinance volume dropped last week for the first time in six weeks, but the level of applications to refinance remains close to recent highs, as historically low mortgage rates continue to draw borrowers into the market,” he said in a statement.
Fixed 30-year mortgage rates hovered just above the lowest rates since the MBA started record keeping in 1990, rising 0.07 percentage point last week to 4.50 percent.