Wednesday, November 02, 2005

Mortgage Rates Increase, Applications Drop.

Mortgage rates increase for the Seventh week in a row. The increases over the past three weeks have been rather significant at that.

Weekly Home Mortgage Rates

The rapid increase in mortgage rates have significantly impacted both new mortgages and refinancing.

U.S. Mortgage Applications Fall to Lowest Since April

``New purchase and refinancing activity are crumbling,'' said Steven Wood, chief economist at Insight Economics in Danville, California. ``While housing activity remains relatively high and continues to contribute to economic growth, that contribution will quickly fade as mortgage rates continue to rise.''

The purchase index fell 6.2 percent to 437.6, from 466.4 the week earlier. The refinancing gauge decreased 2.8 percent to 1862.8 from 1916.8.

U.S. homeowners will turn a record $204 billion of real- estate equity into cash this year by refinancing mortgages at higher balances to take advantage of gains in property values, Freddie Mac said yesterday.

The increase in mortgage rates as well as the decrease in buyer activity will have a significant impact on home prices in the coming months.

Caveat Emptor,
Grim

4 Comments:

Anonymous Anonymous said...

Turning equity into cash, hilarious and sad at the same time, homeowners have been duped into believing that by taking a loan (debt) is somehow a good thing. It is not possible to borrow their way to prosperity/ the reality is they will be in financial agony at some point in the future, which I believe is near.

11/02/2005 09:40:00 PM  
Anonymous Anonymous said...

The fools have bought into the real estate industries spin that house prices only go up and paying any price will be okay.
Well, they have been duped. Their paper wealth is going to go up in smoke and those HELOCs are not going away.

11/03/2005 08:22:00 AM  
Blogger grim said...

10Y Bond Yields pushed through the 4.6 barrier today.. Ended the day at 4.644. Look for mortgage rates to increase again next week. The crunch is on.

grim

11/03/2005 06:00:00 PM  
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4/18/2006 11:12:00 PM  

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