June 20, 2018 / 12:49 PM / 9 months ago

U.S. mortgage applications rise most since January: MBA

FILE PHOTO: A "For Sale" sign is seen outside a home in Cardiff, California February 22, 2016. REUTERS/Mike Blake/File Photo

NEW YORK (Reuters) - U.S. mortgage applications increased the most last week in more than five months, as some 30-year home loan borrowing costs held steady or fell from the prior week, the Mortgage Bankers Association said on Wednesday.

Domestic home sales and construction have remained resilient this year despite higher mortgage rates, more expensive lumber and shortages of land and labor.

U.S. housing starts neared an 11-year peak in May at an annualized pace of 1.350 million units, while building permits fell 4.6 percent, the Commerce Department said on Tuesday.

The Washington-based mortgage industry group said its seasonally adjusted index on filings for home loans rose to 384.1 in the week ended June 15. This was up 5.1 percent from a week ago, marking the largest percentage gain since a 8.3 percent jump in the week of Jan. 5.

Interest rates on 30-year fixed-rate “conforming” home loans, whose balances are $453,100 or less, averaged 4.83 percent, matching the prior week’s level, the MBA said.

The average rate on 30-year loans backed by the Federal Housing Administration, which are often used by first-time home buyers or borrowers with patchy credit, dipped to 4.82 percent from 4.83 percent the previous week.

The MBA’s seasonally adjusted gauge on loan applications to buy a home, a proxy on future housing activity, rose 4.3 percent last week to 259.6, a two-month high.

The group’s seasonally adjusted barometer on requests to refinance an existing home loan increased to 1,052.3, up 6.1 percent, the biggest rise in three months.

Reporting by Richard Leong; Editing by Steve Orlofsky

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