Low mortgage rates are setting the stage for growth, not just in refinancings, but in purchase volume as well during 2020, according to Ellie Mae.

The refi share remained static in January from December at 46%, but it surged from 35% a year ago in response to the considerable drop in mortgage rates during 2019, Ellie Mae's Origination Insights Report said.The 30-year note rate fell to 3.96% in January, down from 3.99% in December and from 5.01% a year ago. Refinancing activity is expected to rise behind declining rates and shortage of affordable houses.

"The start to 2020 saw interest rates decline and refinances hold steady, driving an increase in our closing rate to 78.2% in January," Jonathan Corr, president and CEO of Ellie Mae, said in a press release. "All indicators show that we will continue to see a healthy housing market in 2020 as more millennials look to purchase homes and interest rates remain at historic lows driving refinance activity. We do expect 2020 to bring some challenges for homebuyers, not because of what they can afford but rather what they can find due to lagging inventory."

In comparison, the closing rate for December was 77.8% and in January 2019 it was 75%. The closing rate reached a high of 78.6% in November 2019. January's purchase loan closing rates increased to 80.7% from 80.3% month-over-month and 78.1% year-over-year. Refi closing rates similarly bumped up to 75.8% from 75.5% and 69.5%, respectively.

The time to close among users of Ellie Mae's loan origination system held at 48 days from the month before while slowing from 45 days the year prior.

The share of adjustable-rate mortgages increased to 6.3% from December's 5.3%, while declining from 8.6% the year before. Average FICO scores for loans closed in January jumped to 738 from 735 the month prior and 724 in January 2019.