Wednesday, August 31, 2005

Mortgage applications down

A report today on CNN/Money says mortgage applications are down nationwide for the second week in a row:
NEW YORK (CNN/Money) - The pace of mortgage applications slowed for the second consecutive week even as mortgage rates fell in August, according to the latest report by the Mortgage Bankers Association.

The industry group's seasonally adjusted index of mortgage applications dropped 4.5 percent to 722.5 in the week ended Aug. 26 after falling 0.7 percent the prior week. The index includes both purchase and refinancing loans.
Might this signal the begining of the end of the boom? Or is it just be a temporary downturn? It's difficult to use this as an indicator of anything significant at this point. All I can say is that the timing is interesting, coming just after the National Association of Realtors started warning about exotic loan products. It also follows widespread national media coverage of the housing boom. The term "housing bubble" is now in the vernacular, and I'm sure every real estate agent from San Diego to Portland, Maine, rolls their eyes everytime a prospective buyer walks through an open house and says "so, do you think we're in a bubble?" Only time will tell if that gives people anything more than second thoughts to mull over as they lay awake the night after signing their life away at closing.

Find the brief CNN/Money article at this link.

— The Boy in the Big Housing Bubble