Economist's Commentary: July 23, 2008
Quick Take on the Economy: July 23, 2008
By Lawrence Yun, NAR Chief Economist
Mortgage Applications - Every Wednesday
- Mortgage applications for home purchases fell in the latest week. The index reading of 335.6 was 6.7 percent lower from the prior week and 21 percent lower from a year ago.
- Refinancing activity also fell.
- FHA and VA loans are taking a bigger role as evidenced by the 167 percent rise in government loans from a year ago. Conventional loan applications fell 37 percent from a year ago.
- The sudden rise in mortgage rates from 6.22 percent to 6.59 percent is the primary culprit for falling business activity for mortgages in the past week.
- This data series on applications filed and not on applications approved has become somewhat unreliable in the past year in predicting actual home sale closings.
What does today's data mean for REALTORS® and consumers?
- Rising mortgage rates hold back homebuyers from seeking out mortgages.
- FHA and VA loans are getting popular.
Daily Forecast Update
- NAR's monthly official forecast as of July 8th (250K PDF)
- GDP Q2: 1.7%
- GDP Q3: 1.7%
- Unemployment rate by election time: 5.8%
- Average 30-year fixed mortgage rate in December: 6.6%
- Average 30-year fixed mortgage rate by mid-2009: 6.7%
- The next Fed policy change: a rate hike in December 2008
This is one in a series of commentaries by the Research staff of the National Association of REALTORS®. Read more commentaries >
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