Requests for mortgages continue upward trend

February 13, 2005|By BLOOMBERG NEWS

Mortgage applications rose for a second week as a decline in 30-year mortgage rates to their lowest level in almost a year spurred refinancing and home sales.

The Washington-based Mortgage Bankers Association said its gauge of applications increased 4.2 percent to 735.9 for the week that ended Feb. 4 from the prior week's 706.4. The average rate on a 30-year fixed mortgage dropped to 5.48 percent, the lowest since March of last year, from 5.61 percent.

Refinancing applications rose 7.8 percent to 2,430.7 from 2,253.9 and have increased in four of the past five weeks.

Home purchase applications rose 1 percent. The data suggest housing will keep adding to economic growth early this year.

"The party is still on for anything connected with housing, and that includes construction, retail, remodeling and mortgage lending," Richard Yamarone, chief economist at Argus Research Corp. in New York, said before the report.

The gauge of applications to buy homes rose to 444.6, the highest in three weeks, from 440.3.

The mortgage survey covers about 50 percent of all retail residential mortgage originations and has been conducted weekly since 1990. The base period is March 16, 1990, when the value for all indexes was 100.

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