Low Interest Rates Finally Spark Mortgage Applications

Two months of low mortgage rates had not sparked demand for purchase applications, at least not until the November 14 week which shows a rare 12.0 percent surge in Mortgage Bankers' data. The surge lifts the year-on-year rate, which had been trending in the low negative double digits, to minus 6.0 percent.

Unlike purchase applications, low mortgage rates have been giving a sizable lift to refinancing applications which are up 1.0 percent in the latest data. Rates edged lower in the latest week, down 1 basis point for conforming loan balances ($417,000 or less) to an average 4.18 percent. Next housing data on the calendar is at 8:30 a.m. ET this morning with housing starts which are expected to show a small gain.