According to the Mortgage Bankers Association, the mortgage purchase application index fell to its lowest level in nearly six weeks to 253, a decline of 4.2% from the week before. This was despite the fact that the average 30-year fixed rate mortgatge continues to hover at 4.73%.
If you are wondering what home sales are going to look like in May and June, based on the past couple of weeks of this data, there is a pretty good chance home sales are going to be flat, and that is a problem considering that the number of foreclosures are surging based on the expiration of foreclosure moratoriums.
The systemic problem that has plagued the housing the market the past two years is that there has been insufficient demand to absorb the excess supply of homes and as a result, home value declines continue to accelerate. Based on the continued apathy to mortgage purchase applications, this trend doesn't look to change anytime soon.
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