Skip to comments.Housing Recovery? Mortgage Refi and Purchase Applications Fall, Pending Home Sales Rise
Posted on 02/27/2013 2:15:46 PM PST by whitedog57
he USA is experiencing an investor-related housing recovery via foreclosure sales, flipping and investors. But as foreclosure discounts normalize, will the housing market continue to recover? Probably not if the deleveraging occurs in the housing market.
According to the Mortgage Bankers Association (MBA) released this morning, mortgage applications fell -3.76% from the previous week. Purchase applications fell -5.15% (NSA) while refinancing applications fell -3.27%. Tight credit still prevails along with negative equity and a glue-like employment recovery.
The share of applications that are for refinancing fell slightly to 76.9%.
The only product that actually grew was government Adjusted Rate Mortgages (ARMs).
New home sales are rising (see WSJ article entitled Builders Fuel Home Sale Rise), but we are not seeing the big surge in new home sales by historic standards. More of a mini-surge, fueled by the FHA.
Pending home sales rose 4.5% in January. Not a big surprise given that pending home sales always seem to rise in January. But how sustainable it is with declining mortgage purchase applications?
Bear in mind that the National Association of Realtors has lowered its 2013 sales forecast.
Mortgage TBAs continue at large premiums to par as mortgage refis slow down.
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