Purchase Market Continues To Surge And So Does Non-QM
The purchase market remains strong with an impressive number of applications. The Mortgage Bankers Association reports weekly on applications for refinance and new purchases based on their purchase index. Here is the latest information based on the week of September 23, 2020.
New purchase applications continue to increase and were up 25% over the same week last year. Mortgage rates increased slightly but the demand for new homes remains strong. And for non-QM, almost 75% of transactions are purchases.
The refinance market dropped 5% during the week of Labor Day but picked up the week after with a gain of 9% week over week and 86% over last year.
August 2020 Performance
Data for August 2020 revealed that new home purchases increased 33.3% over August 2019. The housing market exceeded expectations and forecasts for August. Low rates, non-QM options, housing demand, and people wanting more space during the pandemic are reasons for the purchase boom.
Average Loan Size
MBA reports that purchase activity has outpaced performance levels over 2019 for the 19th consecutive week and their survey shows an average loan size at a new record high of $370,200. And the average loan size for our non-QM loans is even higher! Just about $500K!