A drop in mortgage rates last week helped to push mortgage applications higher, the Mortgage Bankers Association reports. Total applications – for both refinancing and home purchases – increased 1.6 percent week-to-week on a seasonally adjusted basis for the week ending June 19. Overall volume is nearly 11 percent higher than one year ago.

Broken out, refinance applications increased 2 percent last week and are up about 4 percent from a year ago, MBA reports. Meanwhile, applications for home purchases—viewed as a strong indicator of future home buying activity—rose 1 percent from the previous week, and are 18 percent higher than they were a year ago.

"The 18 percent [annual] gain in purchase application volume is yet another sign of growing strength in the housing market following this week's stronger numbers on new and existing home sales," says Michael Fratantoni, MBA’s chief economist.

Mortgage rates offered a slight relief to borrowers last week. MBA reports the average 30-year fixed-rate mortgage last week dropped to 4.19 percent; it was averaging 4.22 percent the week prior. But the drop was likely short-lived and there were signs of lenders moving rates higher Tuesday, CNBC reports.

Source: CNBC.com