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US Housing Set Up for a Strong Push into Fall

September 6, 2016



Home sales are retaining momentum as we push into fall.

The NAR’s Pending Home Sales Index posted at a respectable 111.3 for July, a 1.3%increase over June’s reading of 109.9. The index posted at its highest level since February 2006 and was second only to the 115 posting this past April. What’s more, NAR data show the increase as broad-based, with only the Midwest failing to improve on its June numbers.

A recent uptick in mortgage purchase applications also leads us to believe that we should see decent sales numbers. Purchase activity has been flat for most of August, but we have seen an uptick in activity over the past two weeks. Confirming our anecdotal evidence, the MBA reported purchase activity increased 1% last week.  

We’re further encouraged by the fact that we’re seeing an uptick in mortgage availability. The MBA’s Mortgage Credit Availability Index increased 1% in July to post at 165.3. This is near the highs set earlier this year.

Even more encouraging, the overall health of credit servicing among consumers continues to improve. Fannie Mae reports that the single-family serious delinquency rate continues to decline. Mortgage loans of three monthly payments or more past due or in foreclosure dropped to 1.3% in July from 1.32% in June.  This is the lowest level since May 2008. Over the past year, the level has fallen by nearly 25%.  

Housing and mortgage lending continue to serve as lead engines of economic growth. We expect that both will continue to serve in their respective capacity deep into 2017.  

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