5/20: EconUpdate by P. Duffy
EconUpdate by P. Duffy
Purchase loans dip 4 percent from previous week but up 2 percent year-on-year
What does this mean? Despite strong demand, low inventory, building material shortages and higher costs are constraining purchase supply, pushing up home prices and loan balances.
The Market Composite Index for mortgage apps increased 1.2 percent on a seasonally adjusted basis from one week earlier, with purchase loans falling 4 percent but up 2 percent year-on-year, and refinance activity rising 4 percent but down 2 percent year-on-year. The average contract interest rate for 30-year fixed-rate mortgages increased to 3.15 percent from 3.11 percent.
Housing starts dip 9.5 percent in April but up 67.3 percent year-on-year
What does this mean? Builders are postponing starting more homes until supply chains catch up.
Privately‐owned housing starts in April were at a seasonally adjusted annual rate of 1,569,000. This is 9.5 percent below the revised March estimate of 1,733,000, but is 67.3 percent above the April 2020 rate of 938,000. Single‐family housing starts in April were at a rate of 1,087,000; this is 13.4 percent below the revised March figure of 1,255,000.
https://www.census.gov/construction/nrc/pdf/newresconst.pdf
Building permits edge up 0.3 percent in April, increase 60.9 percent year-on-year
What does this mean? Builders remain bullish on new home demand as they address shorter-term supply challenges.
Privately‐owned housing units authorized by building permits in April were at a seasonally adjusted annual rate of 1,760,000. This is 0.3 percent above the revised March rate of 1,755,000 and is 60.9 percent above the April 2020 rate of 1,094,000. Single‐family authorizations in April were at a rate of 1,149,000; this is 3.8 percent below the revised March figure of 1,194,000.