Mortgage Applications in U.S. Rise 16%, Biggest Gain Since June

[Purveyor]

By Alex Kowalski

March 9 (Bloomberg) -- Mortgage applications in the U.S. rose last week, reflecting gains in purchases and refinancing that signal the housing market may be stabilizing.

The Mortgage Bankers Association’s index of loan applications surged 16 percent in the week ended March 4, the biggest gain since June. The measure fell 6.5 percent in the previous period that included the Presidents’ Day holiday. The group’s purchase index climbed 13 percent last week, the most since November, while its refinancing gauge jumped 17 percent.

As the jobless rate eases and companies ratchet up hiring, more Americans may look to buy houses, stabilizing the industry that triggered the recession. At the same time, a growing number of foreclosed properties continues to depress prices and may hamper the housing recovery.

“The housing market in the U.S. still has a lot of challenges ahead of it,” Michael Gregory, a senior economist at BMO Capital Markets in Toronto, said before the report. “Ultimately it’s all about how many homes still are going to hit the market. People don’t want to buy homes because they feel prices could fall further.”

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[BR_Parkway]

1. Rosy headlines followed by the real gloomy stuff at the end - seems to be standard anymore

for real estate reporting.

A 16% jump in applications from the previous week which included a banking holiday? Oh my, sunshine and roses, the economy is fixed!!!!

then in the bottom 2 paragraphs:

“We need confidence to go up,” Chief Executive Officer Ara Hovnanian said March 2 during a call with analysts. “We need employment numbers to get better, and I think that’ll attract traffic as well as customers.”

The S&P/Case-Shiller index of home values in 20 cities fell 2.4 percent in December from a year earlier, the biggest 12- month decrease since December 2009. Prices were down 31 percent from their peak in July 2006, the data showed on Feb. 22.

It's like they've all been told to put the same spin on it because they so desperately need that market to come roaring back - in spite of the fact that it simply can't.

[jtuck004]

2. Did a return this week for someone who was will'd a house in 2008

Comps at the time pegged the value at about $245K

The person sold it last year for $173. (She was lucky, didn't have to buy it first at $245 like most people).

So prices go down, sales go up. And there are 5 million more underwater.

But the real news is that the home has been the primary retirement vehicle for tens of millions of people. 10,000 people a day are turning 65 (and will for the next 19 years). And a full 1/3 retire with nothing except Social Security, if that.