New-home sales falter; mortgage applications increase
Posted July 25, 2012
Europe is still a significant driver for US Mortgage Rates, as well as one of the biggest global threats to the US economy. That message was delivered by Treasury Secretary Tim Geithner Wednesday morning in Washington as he spoke to members of the House Financial Services Committee. The recent return of unrest in Europe has helped to move US Treasury Yields to new all-time lows, with the 10 Year reaching a yield of 1.39% Tuesday. Mortgage Rates continue to be the beneficiary of the global unrest, giving the US Housing Market much to cheer about as it relates to housing affordability.
Earlier this week, US Home data had been positive, noting that home prices increased in May according to the most recent report out from the Federal Housing Finance Agency’s House Price Index. The index gave us a 0.8% increase from April to May, and in the twelve months ending May, 2012, home prices nationally were up 3.7%. New Home Sales Wednesday morning delivered a different message unfortunately, indicating an 8.4% decline in June, posting its biggest decline in over a year and adding speculation that the US economic slowdown was beginning to add volatility to the rebounding housing sector.
This week’s Mortgage Application Index offered an increase of 0.9% for the week ending July 20th. Low mortgage rates continue to drive refinances, which now account for almost 81% of all applications. Purchases dropped 2.8% for the week.
Finally some good news in the housing jobs sector for North Carolina. The Associated General Contractors Association of America reported that construction hiring in North Carolina increased by 1,400 positions in June. A wonderful statistic and a trend that we hope will continue for many months to come.