Mortgage applications, housing prices on the rise

07.23.09
By James Conroy

There may actually be good signs for the nation's housing market as the number of people applying for a home loan increased slightly last week, while at the same time homeowners got a bit of good news with the findings from the government that home prices ticked up somewhat in May.

The Mortgage Bankers Association (MBA) figures released Wednesday show that for the week ending July 17, mortgage loan applications increased 2.9 percent compared to the week prior. These numbers are also up over the same period last year with last week's figures showing a 6.6 percent rise over the same week in 2008.

Homeowners looking to refinance also appear to have increased as the MBA says refis rose 4 percent over the previous week.

These applications rose despite the fact that mortgage rates also increased, according to the MBA. The weekly report finds that the 30-year fixed-rate increased from 5.05 percent to 5.31 percent while the 15-year fixed-rate rose from 4.59 to 4.80.

At the same time, the Federal Housing Finance Agency (FHFA) reported that seasonally-adjusted home prices increased 0.9 percent in May after falling 0.3 percent the month before. Housing prices also fluctuated in different parts of the country with the report indicating that New England saw a 2 percent drop in prices while the Pacific Division saw a 2.7 percent increase.

Despite the slight increase, the FHFA says housing prices are still down 5.6 percent over the last 12 months and have seen a 10.7 percent drop from their highpoint in April 2007.

Although these figures seem to indicate a rebound for the housing industry is in the near future, some say more research is needed. In his Real Time Economics blog for the Wall Street Journal, Phil Izzo says that it's "too early to call a bottom in home prices."

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There appears to be some good news for homebuyers