Posted on 04/10/2013 2:44:06 PM PDT by whitedog57
According to the National Association of Realtors (NAR), housing affordability dropped in the last month because of house price increases and slightly increasing mortgage rates.
But thanks to The Fed, mortgage rates are around 3.5% (30 year fixed) and is tipping the scale towards owning a home rather than renting.
There is growing confidence among homebuilders (still below 50%). However, it dipped down in the last reading.
Notice that both mortgage purchase applications (yellow line) and homebuilder confidence (white line) peaked in 2005 and began falling (although mortgage purchase applications rallied in mid 2007). Then the wheels came off.
Here is Goldman Sachs take on the homebuilder confidence index. According to the chart, homebuilder sentiment is signaling contraction.
After the tremendous run-up in homebuilder stocks over the past year (+150% for Pulte Homes), the market has slowed down during the past month (except for Ryland and KB Homes.
The NAREIT Equity index, on the other hand, has been on a tear over the past year AND month.
While some at debating whether there is a housing bubble or not, what we know is that the housing market is improving. Although it is two steps forward and one step back.
Employment recovery would REALLY help!
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.