Florida Home Mortgage Applications Jump 8.8 Percent; Refinance Activity Surges

Florida mortgage applications rose sharply last week, in large part due to a surge in home loan refinancing as borrowing costs remained at or near recent lows.

The association reports that for the week ending November 3, Florida home loan applications increased by a substantial 8.8 percent to 620.9 from the previous week’s 570.8.

Last week, they fell 3 percent. While refinancing activity comprised the bulk of the increase, demand for conventional Florida mortgage options was also strong this week.

The MBA’s seasonally adjusted purchase index rose 7.1 percent to 402.2 over the past seven days, though it remains substantially below the level of 465.7 seen one year ago.

Borrowing costs on 30-year fixed-rate mortgages, excluding points, averaged 6.24 percent, unchanged from the previous week, according to the MBA, but well-below a four-year high of 6.86 percent reached in June. Florida mortgage loan rates were also below year-ago levels of 6.31 percent.

The group’s purchase index is considered a timely gauge of home sales, which have languished in recent months, especially in certain counties, and for much of 2006, after the record gains posted throughout the first half of this decade.

Record low home mortgage rates helped spur demand for homes throughout the state from 2000-2005, but we are now seeing the boom subside considerably — in the South Florida housing market in particular.

The MBA’s seasonally adjusted index of home loan refinancing applications increased by a strong 11 percent to 1,897.9. When reports of the latest Florida mortgage rates are released later this week, expect little or no change from their levels a week ago.