On the purchase side? It shows how silly it is when everyone claps like seals with this uptick in housing starts there, or that uptick in purchase applications there. When you take a step back, we are at 1996 levels of mortgage originations, despite a much larger population.
Bottom line, we remain in a cold, dark winter in the housing market. These meaningless upticks of 3-4% here or there are just bounces along a very long rocky path...
As for Operation Twist, frankly the market has already sniffed it out and already is driving the 10 year down. By the time it is announced officially (probably latter September), I expect the market to have already done 90% of the work - very similar to what happened before QE2 was officially declared.
Here is some of the ugly - again the news on refinancing was probably the most startling
- Demand for U.S. home loans fell for a third straight week last week although mortgage rates fell to or near record lows, an industry group said on Wednesday. The Mortgage Bankers Association's seasonally adjusted mortgage applications index, which includes both refinancing and home purchase demand, dropped 4.9 percent in the week ending September 2.
- The MBA's seasonally adjusted refinancing application index fell 6.3 percent while its gauge of loan requests for home purchases climbed 0.2 percent.
- Fixed 30-year mortgage rates averaged 4.23 percent, down from 4.32 percent the prior week and the second lowest rate since the group began its survey nearly 22 years ago. The 30-year fixed rate loan hit its lowest rate of 4.21 percent, just 0.02 percentage point below the current rate, last October, the MBA said.
- Fifteen-year loan rates averaged 3.41 percent, down from 3.49 percent a week ago to a new survey low.
- "Despite these rates, refinance application volume fell for the third straight week and is more than 35 percent below levels at this time last year," Mike Fratantoni, MBA's vice president of research and economics, said in a statement.
- "Purchase application volume remains relatively flat at extremely low levels, close to lows last seen in 1996," he said.
- Many borrowers who could refinance at these low rates have already done so, several housing analysts said.