The housing market received solid numbers in August. Housing Starts rose 4% in August from July to an annual rate of 1,615,000 units versus 1,560,000 expected. Housing Starts were up 17.4% year over year. However, single-family starts were down 2.8% monthly. Building Permits, a sign of future construction, rose 6% to 1,728,000 versus the 1,600,000 expected. Lumber prices have fallen dramatically from near $1,700 in May to $593 today but land and labor shortages, as well as higher supply costs, persist.
The number of loans in forbearance continues to decline, now down to 3%. The MBA says there are 1.5 million homeowners in forbearance plans. The share of Fannie Mae and Freddie Mac loans in forbearance decreased 5 basis points to 1.47%. Spokesperson Mike Fratantoni said, "20% of loans in forbearance are either new forbearance requests or re-entries. At this point, borrowers in forbearance extensions are exiting at a faster rate as they near - or reach - the expiration of their maximum forbearance term."
The MBA reports that mortgage applications for new home purchases in August fell 17% from a year ago. Monthly, applications were up 9% from July. Joel Kan, MBA's Associate Vice President of Economic and Industry Forecasting said, "While the new home construction market is a much smaller segment of the overall housing market, prospective buyers are increasingly turning to new homes because of the very low levels of existing homes for sale.
Housing Starts rise. Forbearance numbers decline. New home purchase applications increase monthly.
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