Housing Indexes: Overall Trend Towards Stability

On Wednesday, January 25, a number of housing-related index numbers were published. These include: MBA Purchase Applications, FHFA House Price Index, and the Pending Home Sales Index.  Follow us after the jump for a review of these numbers.

MBA Purchase Applications: This weekly index from the U.S. Mortgage Bankers Association shows that applications declined by 5 percent in the week ending January 20 after a 23 percent surge the previous week.  The surge was attributed to record low rates and favorable pricing, and the slight edge downward occurred when rate terms worsened slightly.  Still, overall the four week average continues to increase, which shows a general trend of growth.

FHFA House Price Index:  The Federal Housing Finance Agency (FHFA) reports that U.S. home prices rose a seasonally adjusted 1 percent in November, up from October’s decrease.  However, over the year, home prices are down 1.8 percent. Data features houses covered by Freddie Mac and Fannie Mae.

Pending Home Sales: Year over year, December pending home sales of existing homes were up 5.6 percent from 2010.  The number fell 3.5 percent off the 7.3 percent gain in November and 10.4 percent increase in October, but the year-over-year growth is viewed as more evidence of increased stability.

Overall, numbers have slightly increased or decreased within a general trend towards stability. Housing isn’t in a hurry to correct from lows, but it has started to firm up and the market is taking this as a positive.

Central Coast Lending is a mortgage broker with offices in Morro Bay, San Luis Obispo, Paso Robles and Arroyo Grande.