Whether it’s the data for existing homes, new homes, housing starts, or builder sentiment, all have pointed to signs of stabilization over the past few months and we hear stories of bidding wars again in some markets. One of the factors the NAR in particular is citing is the lack of inventory, whether because of the slowdown in foreclosure proceedings or sellers waiting for higher prices. Whether the case or not, one indicator is standing in contrast to the bottoming housing figures and that is weekly mortgage applications to buy a home. They fell for a 5th straight week and is at the lowest level since Feb. In analyzing existing home data in the next few months we should start focusing on how many are being bought for cash by investors who then plan to rent them out, a continuously growing trend.
In Asia, while the Shanghai index fell to a 2 week low and cannot gain any upside traction, the Indian Sensex index rose to a 5 month high on hopes for central bank easing after yesterday’s less than expected inflation report. In the UK, pre olympic hiring helped July jobless claims to unexpectedly fall. The other thing of note this morning is the continued uptick in bond yields in all the perceived safe haven countries such as the US, UK, Germany, France, Sweden, Netherlands and Japan.