Mortgage applications not as strong as mortgage rates.
Rates are certainly at the lowest of the lows. We can get excited about these low mortgae rates, but where are the loans. The most recent MBA survey indicates that the number of mortgage applications have declined almost 3% for the week. Refinances were even down, but the purchase portion of the mortgage application is at its lowest since 1996,and is 43% lower that this time last year.
The slow pace of the recovery is driving our historically low mortgage rates, but it cannot drive the housing recovery.
Paul Krugman speaks of a defacto double dip recession - maybe not technically a double dip but:
"Let's be clear: a recovery that involves growth so slow that unemployment and excess capacity rise, not fall, isn't really a recovery. If we have only have 1 1/2 percent growth, that will amount to a double dip in all the senses that matter."
Last week began with encouraging news about corporate earnings, starting right away with Alcoa. And maybe all the talk about the recovery is sound.
But then the Federal Reserve published it downward revision of GDP growth and its upward revision of unemployment.
Retail sales fell .5%.
Consumer sentiment dropped a whopping 8 points. That I was not expecting.
And Friday 6 more banks closed - the total for the year is now 96. We will certainly hit 100 by the end of July.
The economic news locally in Chattanooga is a little better.
VW plant is nearing completion
And there are other good signs - a day care expanding, some stores opening new locations, some local manufactures winnind bids for new contracts.
But Chattanooga is not in a vacuum. For our growth, gains are needed in ther overall economy.
It will be another full week of economic reports this coming week. I will be looking for some good news, even if it does push mortgage rates up.
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Richard Smith |
American Acceptance Mortgage, Inc |
FHA, VA, Rural Development, Conventional, Jumbo,
Reverse Mortgages, FHA 203k Renovation
Home financing in Tennessee and Georgia.
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Richard Smith Conventional, FHA, FHA 203k, HUD $100 down purchases, VA, Jumbo VA, Rural Development, Jumbo, FannieMae Homepath, Home Equity Line of Credit (HELOC). |
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Stearns Lending, Inc |
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Cell phone: 423-280-0345 Email: Richard@HomeLoansChattanooga.com |
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This blog represents the opinions of Richard Smith. The posts and comments written on the blog do not represent the opinions or positions of Stearns Lending, Inc. |
