This morning, one of my colleagues informed me that the real estate sales market is back based on new mortgage applications. When she first told me this, I thought it was based solely on re-financing of existing mortgages due to the historic low-interest rates.
However, after doing a little digging, If mortgage demand is an indicator, buyers are coming back to the Boston real estate market far faster than anticipated, despite coronavirus shutdowns and job losses in Massachusetts and around the country.
Mortgage applications to purchase a home (nationwide) rose 6% last week from the previous week, according to the Mortgage Bankers Association’s seasonally adjusted index. Purchase volume was just 1.5% lower than a year ago, a rather stunning recovery from just six weeks ago, when purchase volume was down 35% annually.
“Applications for home purchases continue to recover from April’s sizable drop and have now increased for five consecutive weeks,” said Joel Kan, an MBA economist. “Government purchase applications, which include FHA, VA, and USDA loans, are now 5 percent higher than a year ago, which is an encouraging turnaround after the weakness seen over the past two months.”
As Massachusetts and other states reopen, so will open houses, and buyers will be coming out in force for downtown Boston condos for sale. Record low mortgage rates, combined with strong pent-up demand from before the pandemic and a low Boston condo sales inventory due to the pandemic, are driving buyers back to the home market. It remains to be seen if this is simply the pent-up demand or a long-term trend.
Source – Read More: Real Estate Mortgages
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