Home buyers and homeowners are taking advantage of some of the lowest interest rates in a year. Mortgage applications for refinancings and home purchases jumped 9.9 percent higher last week on a seasonally adjusted basis, the Mortgage Bankers Association reported Wednesday. Still, the MBA reports the weekly index remains about 19 percent lower the same week a year ago, which is mostly attributed to a decrease in refinancing applications.

The 30-year fixed-rate mortgage averaged 4.03 percent last week, dropping from 4.06 percent the week prior, the MBA reports.

"Overall, mortgage rates continued to decline last week with the 30-year fixed rate decreasing 3 basis points to its lowest level since the 2016 election,” says Joel Kan, an MBA economist. “Rates have decreased almost 20 basis points since mid-July.”

Applications for home purchases soared 11 percent last week and are now 7 percent higher than a year ago, the MBA reports.

Applications for refinancings increased 9 percent during the week. Refinance applications, however, are still 35 percent lower than the same week a year ago, when interest rates were lower.

Kan says mortgage applications likely would have gone even higher last week if it wasn’t for two major hurricanes to strike the U.S. over the past two weeks.

“To illustrate the impact of the two major hurricanes … mortgage applications for the state of Texas ran about 25 percent lower than the state's weekly average for the year to date, reflecting the impact of Hurricane Harvey," says Kan. "Additionally, in the most recent week we saw mortgage applications in Florida fall 48 percent lower than its 2017 weekly average, as many residents evacuated in anticipation of Hurricane Irma. In comparison, the level of applications for the nation last week was only 12 percent lower than its 2017 average."

Source: “Mortgage Applications Leap Nearly 10% on Lowest Rates in Almost a Year,” CNBC (Sept. 13, 2017)