Econintersect: CoreLogic’s Home Price Index (HPI) shows that home prices in the U.S. increased for the fourth consecutive month – up 0.8% in July 2011 month-over-month and declined by 5.2% year-over-year. Mark Fleming, chief economist for CoreLogic stated:
While July’s numbers remained relatively positive, particularly for non-distressed sales which have been stable, seasonal influences are expected to fade in late summer. At that point, the month-over-month growth will most likely turn negative. The slowdown in economic growth and increased uncertainty caused by the recent stock market volatility will continue to exert downward pressure on prices.
Altos Research has already reported that August real estate prices are already dropping. CoreLogic again has made major revisions to its index going back years, and currently has an almost identical trend line to Case-Shiller data released this week (analysis here). The value of an index is diminshed when the data wobbles – as its monthly releases can be questioned whether it is properly trending in real time.
The Mortage Bankers Association reported mortgage applications decreased 9.6% from one week earlier for the week ending August 26, 2011. The refinance share of mortgage activity decreased to 77.8% of total applications from 79.8% the previous week.
“Accounting for the increase in average points paid, effective mortgage rates were little changed last week. Refinance application volume declined for a second week from recent highs, despite rates staying near a 10-month low, while purchase volume remained near 15-year lows,” said Mike Fratantoni, MBA’s Vice President of Research and Economics.
The average contract interest rate for 30-year fixed-rate mortgages decreased to 4.32% from 4.39%. Hat tip for the graph below to Calculated Risk.
source: CoreLogic, MBA, Calculated Risk
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