Data from the Mortgage Bankers Association showed that applications for home loans last week were 18% higher than a year ago.

The boom in applications follows a fall in average interest rates. Your Mortgage reported last month that many products were now on offer below 4%.

Compared to last week rates were virtually flat, increasing by 0.1%.

Remortgage applications were a key reason for the growth of the market. The number of people looking to refinance grew 3% to reach its highest level since May 2015. Purchase applications are 20% higher compared to a year ago.

Lynn Fisher, vice president of research and economics at the Mortgage Bankers Association, said the falling mortgage rates had enticed more people into the market.

“As rates declined over the past few weeks, refinance activity picked up in terms of share and volume in the most recent week’s data. The refinance share, at 53 percent, was the highest refi share since April and the refi index increased 3.1 percent to reach its highest level since May,” she said.

The interest rate charged on a 30-year fixed rate term – the standard deal in the US – averaged 4.13%. For larger loans the average was 4.08%