Mortgage applications increased slightly from a week earlier, as refinances hit their highest level since March.
The Mortgage Bankers Association's weekly composite index found that mortgage loan application volume rose 0.2% on a seasonally adjusted basis for the period ending Aug. 29. The week before, the index was up 2.8%.
Refinance activity increased 1% week over week and now represents 57% of total applications. Meanwhile, the purchase index decreased 2% on a weekly basis and accounts for 35% of all application volume. The other 8% of total applications were adjustable-rate mortgages, the Washington-based trade group said.
"While the purchase application numbers are still below last year's levels, much of the recent housing data has been encouraging," said Bill Banfield, vice president at Quicken Loans. "Geopolitical turmoil continues to keep rates historically low, as investors look for stability in bonds, leaving an opportunity for those looking to purchase or refinance."
The average 30-year fixed rate mortgage was 4.25% through Aug. 29, which is down three basis points from a week ago. A 30-year jumbo mortgage remained unchanged at 4.22% and a 30-year mortgage backed by the Federal Housing Administration jumped one basis point, to 3.99%. Furthermore, the average 15-year fixed rate mortgage increased one basis point, to 3.48%.
The Mortgage Bankers Association's survey covers 75% of all U.S. retail residential mortgage applications.