Lower mortgage rates lead to increased demand from homebuyers

Good news of better interest rates sparked a flurry of activity in the housing market, and the volume of mortgage applications rose 6.5% from the previous week, according to real estate agent.com. This drop in mortgage rates represents potential savings of hundreds or even thousands of dollars per year on mortgage payments. Many people also took the opportunity to refinance their existing mortgages as well. Existing homeowners have recognized the opportunity to save money on their current home payments, and refinancing has increased 4.8% over the same period.

Many people watched what was happening in the banking industry and yet chose to refrain from making a decision. Joel Kan, Vice President and Deputy Chief Economist of the Mortgage Bankers Association, said: “While lower rates should boost housing demand, volatility in financial markets may cause buyers to put decisions on hold,” says -he. It’s no surprise that recent economic volatility has been a cause for concern for many, especially as unpredictable events have unfolded in recent days. However, it also seems that many buyers are simply waiting for such opportunities to arise and are ready to act when the time comes.

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