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Consumers regain confidence, seek mortgages

November 29, 2010 - Experts say that a sharp rise in purchase activity for residential mortgages could mean that Americans are regaining confidence in the economy and might soon be calling up moving companies.

The Mortgage Bankers Association reported that purchase applications increased 14.4 percent during the week ending November 19 - including Veterans Day - reaching their highest levels since May. The strong surge in purchase activity offset a 1 percent drop in refinance applications. Total mortgage application volume increased 2.1 percent, and refinancing proceeded to make up a smaller share of all applications, falling to 78.6 percent.

"The increase in purchase applications last week aligns with other incoming data suggesting that consumers are feeling somewhat more confident with their financial situation," said the MBA's vice president of research and economics, Michael Fratantoni. "The level of purchase applications on a seasonally adjusted basis is now at its highest level since the expiration of the homebuyer tax credit."

More Americans may be considering moving into new homes because of rising income levels. The latest report from the Bureau of Economic Analysis showed that personal incomes grew 0.5 percent nationwide in October as wages and salaries rose higher.
 

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