Plunging Mortgage Applications: Reporters Should Notice

May 19, 2011

Home sales fell through the floor last May as the first time home buyers tax credit ended in April. The expiration of the credit pulled a lot of sales forward, so that few people were buying in May.

This is why it should have people very concerned that purchase mortgage applications for last week were actually slightly below the level for the same week last year. The same was true for the prior week also. These are weekly data, which means that the numbers will be erratic, but this is not a good sign.

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