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Strategies & Market Trends : The Residential Real Estate Crash Index -- Ignore unavailable to you. Want to Upgrade?

To: Think4Yourself who wrote (141979)	8/20/2008 8:21:42 AM
From: Paul Kern	Read Replies (1) \| Respond to of 306849

Yup, housing recovery right around the corner... Rates are up and mortgage apps, purchase and refi, are still running along their all time low.

To: Think4Yourself who wrote (141979)	8/20/2008 8:22:57 AM
From: Paul Kern	Respond to of 306849

U.S. MBA's Mortgage Applications Index Fell 1.5% Last Week By Timothy R. Homan Aug. 20 (Bloomberg) -- Mortgage applications in the U.S. declined last week to the lowest level since December 2000 as fewer homeowners sought to refinance their mortgages. The Mortgage Bankers Association's index of applications to buy a home or refinance a loan dropped 1.5 percent from the prior week to 419.3. The group's purchase index fell 0.4 percent and its refinancing gauge slumped 3.7 percent. Higher borrowing costs, stricter loan standards and falling property values are preventing owners from tapping into home equity, raising the risk that consumer spending will slow even more. The worst homebuilding recession in 26 years is likely to remain a drag on growth. ``The biggest threat to the economy is the fragility in the financial system, which stems largely from the deteriorating performance of residential real estate credit,'' Michael Feroli, an economist at JPMorgan Chase & Co. in New York, said before the report. ``That performance is unlikely to improve until there are signs of some stabilization in house prices.'' The purchase index fell to 314 after no change the prior week. The refinancing measure declined to 1034.5, also the lowest level since December 2000, from 1074.6 the prior week. The share of applicants seeking refinancing fell to 34.8, the lowest since July 2006, from 35.2 percent the prior week. The average rate on a 30-year fixed loan dropped to 6.47 last week from 6.58 percent, the report showed. In mid January, the rate was at an almost three-year low of 5.5 percent. Borrowing Costs At the current rate, monthly borrowing costs for each $100,000 of a loan would be $630, or up about $62 from the January low. Borrowers face stiffer lending guidelines, according to the Federal Reserve's quarterly survey of bank loan officers published last week. About 75 percent of the officials indicated they tightened standards on prime mortgage loans, up from 60 percent in the April survey, the Fed said. Banks that originate non-traditional mortgage loans also toughened lending rules. The average rate on a 15-year fixed mortgage decreased to 5.99 percent from 6.17 percent. The rate on a one-year adjustable loan dropped to 7.07 percent from 7.15 percent. It had reached a seven-year high of 7.25 percent in July. Homebuilders are struggling to boost earnings amid the housing slump. The five largest U.S. homebuilders reported a combined $1.08 billion in losses in their most recent quarters. The Washington-based Mortgage Bankers Association's loan survey, compiled every week since 1990, covers about half of all U.S. retail residential mortgage originations. To contact the reporter on this story: Timothy R. Homan in Washington at thoman1@bloomberg.net Last Updated: August 20, 2008 07:00 EDT