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MORTGAGE applications rose despite a jump in borrowing costs last week, but still bounced around the year’s lows with unemployment fears depressing demand. The Housing Market is looking up and consumers’ confidence is building up as well.
The Mortgage Bankers Association’s total loan applications index rose by a seasonally adjusted 2.8 percent to 528.9 last week, even as 30-year mortgage rates rose by about 1/4 percentage point to 5.31 percent.
The measure of requests to buy homes and refinance loans was up from a seven-month low due primarily to consumers realizing the end for the real estate market might be over. So, they are coming out to shop for home. The $8,000 tax credit is also a big plus for first--time home buyers.
"The primary negatives right now are the high rate of unemployment and general uncertainty about the future path of the economy, which make people reluctant to buy." I see that the stocks are high due to companies keeping its growth numbers. Normally, when growth comes hiring, right? However, these companies are growing but not yet hiring, because they are waiting on the big boys to start, then they will follow. Therefore, I hope by year’s end the job market will get better but almost for sure, next year it will.
Home affordability has vastly improved with mortgage rates about 1-1/4 percentage less than a year ago and home prices, now going between 4.75 percent to about 5.125 percent on loans below $417,000.
But the fear of unemployment, with the highest rate of job loss in almost 26 years, is keeping many potential buyers unwilling or unable to commit to such a major purchase, economists said. But they are not saying that most of them have savings and are itching to spend once all the bad news is over and done with.
The MBA’s index of applications to purchase homes inched up by 1.3 percent last week to 262.1, and has been fairly range-bound for months.
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