Mortgage Application Volume Sees Strong Recovery After Rates Fall

Mortgage application volume bounced back last week as rates dropped. This was a welcome relief for many homebuyers and refinancers who had been watching rates rise for several weeks.

The drop in rates was significant, with the average 30-year fixed mortgage rate falling to 3.9%. This is a full percentage point lower than the rate just a few weeks ago.

Homebuyers and refinancers took advantage of the lower rates, submitting a total of 64.3% more mortgage applications than the week before.

Additional reading: Will Mortgage Rates Ever Go Back down to 3

Mortgage application volume jumped 15.6% last week, the largest increase in over a year.

This significant boost in volume is a welcome change for prospective homebuyers who have been struggling to find homes on the market.

Without seasonal adjustment, volume for the week ended June 7 was up 26%.

Applications for refinances increased 28% compared to the previous week and were also up 28% compared to the same week one year ago.

The refinance share of mortgage activity increased to 35.2% of total applications, up from 31.1% the previous week.

Home inventory levels are up significantly from last year at this time, which is good news for frustrated homebuyers.

A different take: Mortgage and Refinance Rates Have Fallen over the Last Week

Mortgage application volume bounced back last week as rates dropped. Mortgage application volume jumped 15.6% last week, the largest increase in over a year. The volume was also up 26% without seasonal adjustment.

The refinance share of mortgage activity increased to 35.2% of total applications, up from 31.1% the previous week. This is a significant increase, and it's likely that many homeowners are taking advantage of lower rates to refinance their mortgages.

Applications for refinances increased 28% compared with the previous week and were up 28% compared with the same week one year ago. This is a clear indication that homeowners are looking to take advantage of lower rates.

The average rate for a 30-year mortgage fell to 7.07%, down sharply from late October when it was close to 8%. This drop in rates has made mortgages more financially viable for many borrowers.

Here's a breakdown of the key statistics:

These numbers suggest that there are many would-be borrowers waiting for rates to drop before taking out a home loan. With rates dropping and home inventory levels increasing, it's a great time to consider applying for a mortgage.