Mortgage Data Decoupled From Other Housing Metrics

Teresa Rivas:

The Mortgage Bankers Association (MBA) reported mortgage application data for the week ending December 20, and purchase applications were down 3.5% week-over-week, following last week’s 6.1% drop, the lowest level since February 2012. The index is down about 11.5% year-over-year so far.
 Raymond James analyst Buck Horne expect that the disconnect between these figures and other more positive housing indicators are only likely to widen as time goes on, thanks in large part to the high prevalence of cash buyers in the market. Cash buyers are more active in the existing home market than the new home market, they write, a situation created in part by stringent underwriting standards, higher interest rates and price increases earlier this year, among other factors. Last month, 32% of existing home sales were all cash purchases.