home buyers are rushing to get mortgages before rates rise further. applications for mortgages to purchase homes soared 13% during the week ended nov. 18 from the previous week, according to data released wednesday by the mortgage bankers association. that was also up 11% from a year earlier and the biggest weekly increase since early january. refinancing applications, though, went the other way, dropping 3% from the previous week, continuing a steady slide as rising mortgage rates have damped demand among existing homeowners. counted together, total mortgage applications rose 3% in the week, reversing course from a decline the previous week. the mortgage market has been shaken up since the election of donald trump as president. mortgage rates have risen by about half a percentage point, averaging 4.10% for 30-year fixed conforming loans on tuesday, according to mortgagenewsdaily.com. late last week, mortgage rates hit 4.125%, the highest in 17 months. while still low by historical standards, the new rates are substantially higher for existing borrowers, many of whom locked in rates below 4% during the past few years. in early july, average rates on 30-year fixed mortgages were as low as 3.34%. interest rates have spiked several times since the housing downturn, only to fall again. but lenders are growing wary, citing president-elect trump<u+2019>s fiscal policies as well as the federal reserve<u+2019>s likely move to increase interest rates as soon as december. <u+201c>from the facts that we see out there, it looks like rates are going to settle at a higher rate than they did in the last few years,<u+201d> said greg gwizdz, national sales manager for wells fargo home mortgage, a division of wells fargo & co., the country<u+2019>s leading mortgage lender. rising interest rates over the long run will make more-expensive homes less affordable for many borrowers, which in turn could affect the rate at which home values have been appreciating in many markets. the latest increase in purchase-mortgage demand was driven by borrowers seeking large mortgages. the average mortgage amount home buyers applied for last week reached $310,200, the highest in the mortgage bankers association survey, which goes back to 1990. write to annamaria andriotis at annamaria.andriotis@wsj.com
mortgage applications soar 13% as buyers act before rates rise - wsj
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