Mortgage Bankers Association for the week of 1/27/2010Market Composite Index: (loan application volume) decreased 10.9 percent on a seasonally adjusted basis from one week earlier.
Refinance Index: decreased 15.1 percent from the previous week and the seasonally adjusted Purchase Index decreased 3.3 percent from one week earlier.
Purchase Index: The four week moving average is up 1.3 percent
Refinance Share of Mortgage Activity: decreased to 67.6 percent of total applications from 71.7 percent the previous week.
Arm Share: increased to 4.7 percent from 4.1 percent of total applications from the previous week.
MBA outlook: (Excerpted from mbaa.org)
Fourth quarter GDP growth of roughly 4-1/2% seems likely. A larger increase in inventory investment is the main reason for stronger fourth quarter growth. I nventory investment is inherently a temporary source of stimulus to economic growth, but is not yet close to running its course.The impact of the stimulus program on federal consumption and investment will run its course by about midyear, and constraints on state and local budgets will probably mean moderate declines in their purchases of goods and services for the next year and perhaps longer. It is the pace of private domestic final salesâ€”consumer spending, capital expenditure, and housing, that will principally determine the economys growth in the year ahead.
While inventories of unsold homes have come down significantly, the shadow inventory represented by homes in foreclosure remains large and growing. Another down leg in home prices cannot, therefore, be ruled out. Builders are still deeply pessimistic: A dramatic increase in home building does not seem to be in the cards. Consumer confidence, though rebounding since the first quarter of last year, remains as low as it was in the deep recession of 1981-82
In other words, we are out of a terrible recession, but left so weak that it we will be in repair mode for quite a while.