Daily Market Commentary for July 20, 2011
Median existing-home price was $184,300 - an increase of 0.8% from June 2010. (read more at Millennium-Traders.Com)http://www.millennium-traders.com/news/newscommentary.aspx
Builder confidence in the market for new single-family housing edged higher during July, according to the National Association of Home Builders. In week ended July 15, mortgage applications jumped 15.5% - mainly due to refinancing - and weekly mortgage applications for purchase loans slipped 0.1%.
It has been known that data provided by NAR has been under scrutiny since other measurements of home sales show an overstatement in NAR figures of up to 20%. NAR concedes that its data could be overstated due to various measurement difficulties and has previously disclosed they are conducting a review of data released. Chief economist of NAR said he doesnâ€™t anticipate the full restatement by the summer, but a preliminary review may be ready in August.
Higher-cost mortgages may push more borrowers and refinancers into adjustable-rate mortgages, with their enticingly lower interest rates. Conforming-loan limits are set to drop to a lower dollar amount and more loans will be considered 'jumbo' loans. These 'jumbo' loans come with higher interest rates because Fannie Mae or Freddie Mac canâ€™t purchase and securitize those loans. Conforming loan Limits vary by market and the lower limits are equal to 115% of the median single-family home price, ranging from $417,000 to as much as $625,500. The change officially takes effect October 1 however, it may be reflected in loan quotes as early as the end of July. The loan-limit reduction will affect 250 counties in the country, according to the Federal Housing Finance Agency - that is 8% of the counties in the U.S. Additionally the Federal Housing Administration has loan limits for loans it will insure and those will be changing in the fall as well.
Zillow (NasdaqGM: Z) got a nice start on its opening day. Shares jumped 123%, rising to $45 in early morning trade after opening on the market at $60 a share.
Skullcandy (NasdaqGM: SKUL) posted a high on their opening day debut of $23.40 a share.
Economic data released today:
MBA Mortgage Applications: Mortgage Bankers Association's seasonally adjusted index of mortgage application activity rose 15.5% in week ended July 15 the biggest monthly increase in four months which was driven by a huge rise in refinancing applications. MBA's seasonally adjusted index of refinancing applications jumped 23.1%, while the agency's measure of new purchase applications was almost unchanged.
Existing Home Sales: Existing-home sales per NAR [National Association of Realtors] - completed transactions that include single-family, townhomes, condominiums and co-ops - declined 8% to a seasonally adjusted annual rate of 4.77 million in June from 4.81 million in May and remain 8.8% below the 5.23 million unit level in June 2010. In the West, Existing-home sales declined 1.7% to an annual pace of 1.14 million in June and are 2.6% below 2010 stats.
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