Mortgage Applications

Each day the Research staff takes a look at recently released economic indicators, addressing what these indicators mean for REALTORS® and their clients. Today’s update discusses mortgage applications.

§ Mortgage applications increased 4.1 percent during the week ending December 9.

§ The Purchase Index declined 8.2 percent from the prior week, while the Refinance index moved in the opposite direction, rising 9.3 percent, driven by declining interest rates.

§ Interest rates on 30-year fixed mortgages declined to 4.12 percent, the lowest rate of 2011.

§ Cash purchases—which have been steady at 30 percent of transactions—were not captured in the data.

§ Import prices during the month of November increased 0.7 percent, according to a report by the Labor Department.

§ On a yearly basis, import prices have risen 9.9 percent, adding to the upward inflationary pressure.

Source: National Association of Realtors

Federal Deficit Posted: 12 Dec 2011 12:08 PM PST Each day the Research staff takes a look at recently released economic indicators, addressing what these indicators mean for REALTORS® and their clients. Today’s update discusses the federal deficit and interest rates. § In today’s data from the Treasury Department, the federal deficit is shrinking a bit, with revenue up and spending down this November, compared to November of last year.  Economic growth, though modest, and some job creation is leading to more revenue and a lessened need to spend on social programs. § $152 billion was collected by the Treasury in November, but the overall spending was about twice as high at $290 billion.  The monthly deficit was therefore $137 billion.  This time last year, revenue was $149 billion, while spending totaled $299 billion. § During the first two months of the new fiscal year (October and November), the deficit has shrunk by 20 percent to $235 billion versus $291 billion in the same period one year ago. § Even though reduction in the deficit is progress, the overall level of government borrowing is exceptionally high.  To spend about twice the amount of tax receipts collected is clearly not sustainable. § Because of the lack of borrowing demand in the private sector (many companies are flush with cash and have no need to borrow), high government borrowing has not pushed up interest rates.  Also many foreign investors and governments have readily supplied funds for the U.S. government to borrow at cheap rates. § At some point in future, interest rates will be less favorable if the deficit persists.  The only way to borrow would be for the U.S. government to offer higher interest rates.  That will also mean higher mortgage rates for consumers in the future. Source: National Association of Realtors

Hello Everyone

Hello Everyone,

Welcome to my new blog. I hope that you will find the information I post to be useful. My goal is to provide clients and future clients with up to date news they can use. Please visit frequently as I will be posting new topics and articles on a daily basis. Feel free to share your questions, comments and concerns.

Thank you,
Ryan T. Kraft
Benchmark Real Estate, LLC