MBA Mortgage Applications (week ended 6/7/2013)
– Purchase Index Week/Week +5.0%. Previous weeks were -2.0%, 3.0%, -3.0%, -4.0%, and +2.0%.
– Refinance Index Week/Week +5.0%. Previous weeks were -15%, -12.0%, -12.0%, -8.0%, and +3.0%.
– Composite Index Week/Week +5.0%. Previous weeks were -11.5%, -8.8%, -9.8%, -7.3%, +7.0%.
Refinancing recovered from the dead but with rates near highs for the year are still restrained. The 5% gain in purchase applications should be a leading indicator of increased home sales. The previous recession in March 2001–Nov 2001 was ended by the housing bubble which was enabled by bad policies by HUD and mortgage lenders. While the Great Recession is over, growth remains slow and it is unlikely that the housing sector will get the economy cooking again because mortgage lending standards are restrictive.
The healthiest outcome would be for Housing Starts to return to the natural level of 1,500,000/year.