Daily Commentary by Larry Baer: According
to data gathered by the Commerce Department -- builders were busy in June as
they started construction on new homes at the fastest pace since the fall of
2008. New construction on single-family
homes climbed 4.7% higher while multi-family starts were up 17%. A forward looking indictor of activity in the
home building industry was not quite as upbeat. Building permit filings for new
single-family homes edged up a very modest 0.6% while permits filed to build
condominiums and apartments declined 11.4%.
Mortgage investors gave this report nothing more than a disinterested
glance.
On a related topic the Mortgage Bankers of
America have released their Mortgage Application Survey index for the week
ended July 13th. Overall
single-family mortgage demand was up 16.9% from the prior week, lead by a
strong 21.6% spike in refinance loan requests.
The pace of applications taken for the purchase of a home edged 0.1%
lower. Refinance applications accounted
for 80.1% of all applications and 78.6% of the perspective loan volume for the
week. The contract rate for 30-year
fixed-rate conforming mortgages finished at 3.74%, down 5 basis-points from the
prior week, down 13 basis-points from four-weeks ago and down 90 basis-points
from the year-ago mark.
In his encore performance before the House
Financial Services Committee earlier this morning Fed Chairman Bernanke only
reiterated what he told the Senate Banking Committee yesterday - the central
bank is ready to act if needed. As
expected, he went on to say Congress needs to gets its fiscal act together in a
hurry if another recession is to be avoided.
In Mr. Bernanke's opinion the central bank has done just about all the
heavy lifting it can in terms of trying to reinvigorate economic growth. As was the case yesterday when Bernanke
testified to the Senate committee -- this event had no meaningful impact on the
current trend trajectory of mortgage interest rates.
THE
MARKET IS ALWAYS RIGHT! . YOU AND I ARE SOME OF THE TIME
