Mortgage Applications:
Purchase Index – Week/Week Change -3.2 %
Refinance Index – Week/Week Change 13.2 %
Composite Index – Week/Week Change 7.8 %

This report is stark. With rates low, refinance applications are up but purchases are down because (where do I start) prices are dropping, consumers lack confidence that they will have a job, qualifying is tougher.

The annual level of Housing Starts is about 950,000 less that what is needed to accommodate population growth and units scrapped. There is a substantial inventory of homes on the market and a large (about 1,000,000 units) of shadow inventory being held off the market less it collapse.

I think that the bottom line is that the housing market is not going to recover this year or next.