Daily Commentary by Larry Baer: It has been an exceptionally slow trading day in the mortgage market so far.
Mortgage investors showed little reaction to a report from the National Association of Realtors indicating existing home sales improved a better-than-expected 4.6% on a month-over-month basis in November. The November gain was watered-down considerably by amendments the Realtors group made to data from 2007 to 2010 that resulted in a downward revision of 14.3% for the period. The annual revision showed the housing recession was deeper than previously thought. On the brighter side, the report showed the number of unsold homes on the market at the end of November represented a 7.0 month's supply at the current sales pace - the lowest mark for this measurement since February 2007.
In a separate report, the Mortgage Bankers of America released their Mortgage Application Survey for the week ended December 16, 2011. The MBA said application traffic for mortgage originators slowed by 2.6% from the previous week. The refinance index fell 1.6% even as mortgage rates were mostly lower. The purchase index slumped 4.9%, but remains well above its three-month moving average.
The contract rate for 30-year fixed-rate conforming mortgages finished at 4.08%, down 4 basis-points from the prior week's level and down by 15 basis-points from a month ago. Refinance requests accounted for eight-out-of-every-ten applications taken last week.
Uncle Sam will wrap up a $99 billion borrowing spree with the sale of $29 billion of 7-year notes this afternoon. The auction will conclude at 1:00 p.m. ET and I'll post results on my website as soon as possible once the final gavel falls.
THE MARKET IS ALWAYS RIGHT! . YOU AND I ARE SOME OF THE TIME
