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Wednesday, 17 June 2020

Mortgage demand booms to 11-year high

Mortgage boom

Housing is well known to be very much an interest rate sensitive asset class.

And US housing markets have overall been remarkably resilient this year.

The MBA mortgage applications index jumped another +8 per cent this week, following on from a +9.3 per cent jump previously.

Total mortgage demand is up by a massive +21 per cent from a year earlier, as the lockdown has driven a tremendous desire to nest. 

The index has zipped to the highest level since the financial crisis, now pushing up to an 11-year high. 

Source: Bloomberg

The average 30-year mortgage rate in the US has fallen to a record low of just 3.30 per cent.

First fixed and now variable mortgage rates have also plunged to record lows in Australia since May 1.

Stand by for Australia to follow suit...