The Mortgage Bankers Association’s Purchase Index, a measure of mortgage loan application volume for home purchases in the U.S., has fallen to its lowest level since September of 2011 on a seasonally adjusted basis. On a non-adjusted basis, the Purchase Index is down 17 percent year-over-year, as it was at the beginning of February.
As we noted two weeks ago, while a lack of inventory is certain to be blamed for holding back applications, according to the National Association of Realtors’ own data, inventory levels are up on a year-over-year basis, with 1.86 million existing homes on the market at the end of December versus 1.82 million homes on the market at the end of 2012.
The banks are finally unloading their pent-up shadow foreclosure inventory because the institutional speculators are heading for the exit.
Hey, lower interest rates and/or devise loans so people with lots of equity can borrow w/o that limiting 43% DTI (which doesn’t work well for self employed, heavily asset boasted, etc.) and then you’ll get more loan business. Simple!