Fewer people seek loans, index shows

Mortgage applications for refinancing fall again

August 08, 2004|By BLOOMBERG NEWS

An index of mortgage applications in the United States fell last week as refinancing declined for a fourth straight week, an industry group said. Home purchases increased.

The Mortgage Bankers Association's gauge of applications to buy and refinance homes fell 0.2 percent to 620.4 from 621.4 a week earlier. Applications to refinance mortgages fell 2.9 percent to 1,600.3 from 1,648.8 a week earlier. The purchase index rose 1.6 percent to 452.

The measure of home buying reached a record 501.6 in January.

Applications to refinance accounted for 35.8 percent of the Mortgage Bankers Association's overall mortgage measure, down from 36.8 percent a week earlier. Refinancing has declined 84 percent since reaching a record in May of last year.

"We certainly have not seen any decrease in demand" for real estate, said Lee Nutter, chief executive officer of Rayonier Inc., a real estate investment trust in Jacksonville, Fla. "It's a very strong business, and we don't see any reason that that should pull back at all."

Economists still forecast home sales to slow in the second half, in part because of a rise in home prices.

Home affordability fell to a two-year low in the second quarter as higher borrowing costs and prices made it harder for people to buy, the National Association of Realtors in Washington said Monday. The median price of a previously owned single-family home rose 9.1 percent to $183,800 from a year earlier.

The rate of new-home sales in June was the second-largest on record, the Commerce Department said. Sales of existing homes, which make up 85 percent of home sales, rose to a record annual pace, according to the National Association of Realtors.

Baltimore Sun Articles
Please note the green-lined linked article text has been applied commercially without any involvement from our newsroom editors, reporters or any other editorial staff.