Amidst the gloom of recession, the US mortgage market seems to have started to show signs of hope as the Mortgage Bankers Association's mortgage market index increased by 5.6% in August 14 week. The number of people applying for a mortgage loan has shown a growth, even as the number of people refinancing their current homes rose up by 6.9%. Construction of single family homes is also at its peak since October, 2008.

Industry experts attribute this increase in mortgage application to factors like sliding real estate prices and Govt's $8,000 tax credit for first time buyers. The dropping interest rates, with the average for 30-year mortgages falling to a 5-week low 5.15%, have also contributed to this rise in mortgage application to a great extent.