4/29/21: EconUpdate by P. Duffy
EconUpdate by P. Duffy
Purchase loan apps fall 5 percent from previous week, but up 34 percent year-on-year
What does this mean? Rising prices are impacting demand, but lower mortgage rates will help improve affordability.
The Market Composite Index for mortgage applications decreased 2.5 percent on a seasonally adjusted basis from one week earlier, with purchase loans falling 5 percent (but up 34 percent year-on-year) and refinance activity falling 1 percent (and down 18 percent year-on-year). The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances decreased to 3.17 percent from 3.20 percent.
February Case-Shiller Index up 12.0 percent year-on-year, largest gain in 15 years
What does this mean? A combination of pent-up and accelerated demand have continued to put pressure on prices.
The S&P CoreLogic Case-Shiller U.S. National Home Price NSA Index reported a 12.0% annual gain in February, up from 11.2% in the previous month. After seasonal adjustment, the U.S. National Index posted a month-over-month increase of 1.1%. The National Composite’s 12.0% gain is the highest recorded since February 2006, exactly 15 years ago, and lies comfortably in the top decile of historical performance.
Consumer confidence index rises sharply to highest level since February 2020
What does this mean? A combination of positive factors have consumers looking forward to resuming normal activities.
Consumer confidence has rebounded sharply over the last two months and, as of April 2021, it at its highest level since February 2020. Consumers were more upbeat about their income prospects, perhaps due to the improving job market and the recent round of stimulus checks. Vacation intentions posted a healthy increase, likely boosted by the accelerating vaccine rollout and further loosening of pandemic restrictions.