Mortgage rates pushed higher and applications retreated prior to the holiday week despite the Federal Reserve's continued mortgage-backed securities purchases intended to keep mortgage rates low.
According to Freddie Mac's Primary Mortgage Market Survey, the 30-year fixed-rate mortgage increased 5 basis points from the previous week to 3.37 percent. The 15-year FRM was basically unchanged for the week, falling 1 basis point to 2.65 percent.
Meanwhile, the Mortgage Bankers Association's Weekly Mortgage Applications Survey reported a 12.3 percent decrease in mortgage applications. The Survey's Refinance Index also fell 14 percent for the week decreasing the refinancing share of mortgage applications to 83 percent from 84 percent the previous week. The Survey's Purchase Index component was also down for the week falling 5 percent after gaining 18.1 percent in the previous five weeks.
Other real estate news showed continued upward trending in housing market activity.
Housing starts were up annually in November, according to the Commerce Department's November New Residential Construction report. Year-over-year, housing starts increased 21.6 percent while November activity slowed slightly, decreasing 3.0 percent. Building permits showed strong annual improvement as well, increasing 26.8 percent and rising 3.6 percent from October. Completions in November were also up annually, improving 16.1 percent from a year ago but showed a slowdown of 9.7 percent in the off-season month.
Existing-home sales and prices also reported gains during the week. The National Association of Realtors stated a 5.9 percent increase in existing-home sales in November helping improve the annual rate to 5.04 million, an increase of 14.5 percent from November 2011. The median existing-home price in November reported by the NAR was also up from October, increasing 1.1 percent to $180,600. The Federal Housing Finance Agency's October House Price Index reported further housing price appreciation, gaining 0.5 percent in October and improving 12.6 percent annually.
The National Association of Home Builders also reported builder confidence improvements during the week. The NAHB/Wells Fargo Housing Market Index gained 2 points in December, improving to 47. Two of the three components were up with current sales expectations increasing 2 points to 51 followed by prospective buyer traffic which increased 1 point to 36. The component measuring sales expectations in the next six months fell 1 point to 51.
Overall, housing market reports for the week were consistently positive. Unresolved fiscal cliff debates, however, may begin to change the trajectory of the market's recovery in the weeks ahead.
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