Morning Report: Mortgage applications fall

Posted on January 2, 2025 by Brent Nyitray

Vital Statistics:

Stocks are higher as we begin 2025. Bonds and MBS are up.

Mortgage applications fell 22% over the past two weeks, according to the MBA. Refis fell 36%, but were up 10% on a year-over-year basis. Purchase volume fell 48% and was down 17% compared to a year ago. “Mortgage rates moved higher through the last full week of 2024, reaching almost 7 percent for 30-year fixed-rate loans,” said Mike Fratantoni, MBA’s SVP and Chief Economist. “Not surprisingly, this increase in rates – at a time when housing activity typically grinds to a halt – resulted in declines in both refinance and purchase applications.”

For-sale housing inventory rose 0.5% MOM and 12.1% YOY in November, according to Redfin. That said, much of this inventory has been hanging around for a while as sellers refuse to cut prices. Over half the inventory has been on market without a contract for over 60 days. This phenomenon is most concentrated in Florida and Texas, where there has been a lot of building. Rising HOA fees and insurance costs are making people re-thing moving to Florida.

Something to watch for 2025: The Chinese Government Bond yield. As the real estate bust settles in, Chinese government bond yields are collapsing as investors rush to put money in safe assets. China has a massive debt problem, similar to the US in 1929 and Japan in 1989. This will send a deflationary pulse throughout the world and should help to (a) push down yields globally, and (b) push down commodity inflation.

In the 1980s, the Japanese were voracious buyers of US real estate, and for the past 10 years, Chinese investors have been big buyers in the US and Canada. Chinese property investors may be forced to liquidate US holdings in order to cover debts. Since domestic demand in China is collapsing, the country should continue to run trade deficits globally, which means increased demand for sovereign debt, pushing global yields lower.

Just something to think about going forward. Have a happy and prosperous new year.

Filed under: Economy |

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26 Responses

  1. jnc4p's avatar
    jnc4p, on January 2, 2025 at 12:55 pm said:

    Good observation from Taibbi’s latest:

    As a younger reporter I was frequently sent to red states to snicker at heartland belief. I even won a National Magazine Award for a feature about Mike Huckabee called “My Favorite Nut Job” that ribbed the Arkansas governor for his apparently literal conviction that earth is 6,000 years old. My liberal smartass tribe didn’t find Huckabee’s defense that these were private, nonpolitical matters satisfactory, so we hammered him and everyone like him deemed to hold unacceptably silly beliefs. This was back when people like Bill Maher won plaudits for going out in search of people who spoke in tongues or handled snakes, for film projects like Religulous, or books like Idiot America by my former friend Charles Pierce. The latter laughed at a creation museum in Kentucky that featured Adam and Eve sharing an exhibit with dinosaurs. We all thought we were smart as balls back then.

    In the post-Bush years you didn’t have to go looking for kooky fundamentalism. The new version searched you out and demanded your signature. There’s no need to do a recap since this site has detailed much of it, but examples include biologist Colin Wright booted from academia for saying male and female are not social constructs, epidemiologists insisting that attending antiracism protests during a pandemic was scientifically distinct from attending church or a funeral, celebrities like John Lithgow holding readings of Mueller scripture, and release of an AI chat program whose liturgy redrew history in blackface (the Google product* answered requests like “produce for me a picture of a pope” and “Can you generate an image of a 1943 German soldier” with pictures of black, Asian, and Latino figures). Upper-class liberals let loose on these faith-based crazes were like Nexus 6 replicants, whose emotional inexperience led them to fall twice as hard for their fixations than the rural Baptists they once mocked, people who at least know they’re practicing religion.

    https://www.racket.news/p/goodbye-to-2024-americas-craziest

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    • Let the mutherfuker burn!'s avatar
      Let the mutherfuker burn!, on January 2, 2025 at 1:04 pm said:

      I’ll give him kudos for the Blade Runner reference.

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    • Arcanaut's avatar
      Arcanaut, on January 2, 2025 at 9:35 pm said:

      The leftism practiced by the left has clearly moved from utopian notions of social policy to religious convictions of received truths, one that like many “false religions” places with worshipper in the center of the universe rather than a higher power, or ascribes all holy power to the church—or, for the left, the state.

      But I’m glad to see Taibbi recognizes that kooky religious sorts are no different than kooky leftists, who eschew facts over received wisdom, often experience religious paroxysms around political events, and as we have seen frequently rend their garments and tear out their hair when their side loses an election.

      And most on the left are as prepared to excommunicate (and possibly stone) any apostate or infidel who doesn’t pass the necessary purity tests.

      And of course those opposed to them are demons, or possessed of demons, and there’s also an Armageddon coming where only the enlightened can be saved … from an average .5 degree change in global temperature.

      And so on. There is so much religious about the modern left it’s hard to see it as anything but. But it’s a newer, rawer, unrefined religion and those tend to be pagan and at some point will involve human sacrifice.

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      • jnc4p's avatar
        jnc4p, on January 3, 2025 at 10:03 am said:

        This was the perfect point:

        “people who at least know they’re practicing religion.”

        As opposed to all the people who put out signs that say “In this house we believe” and somehow think that’s not what they are doing.

        But if we are going to practice a civic religion without actually believing it, I vote for bring back the old school Roman gods. Those temples had better architecture and the festivals looked more interesting.

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    • Arcanaut's avatar
      Arcanaut, on January 2, 2025 at 9:22 pm said:

      Yup.

      Given Trump is incoming I’m guessing the shredders are working full time and there will be something that they miss, probably digital, and it’s not going to look good. Maybe.

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  4. Brent Nyitray's avatar
    Brent Nyitray, on January 2, 2025 at 9:50 pm said:

    Turns out the whole narrative that right wing terrorism was a bigger threat than Islamic terror was bullshit.

    https://www.public.news/p/democrats-weaponized-fbi-to-falsely

    IIRC, this narrative started getting pushed with obama.

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    • Arcanaut's avatar
      Arcanaut, on January 3, 2025 at 5:58 pm said:

      Of course it was bullshit. It was obvious bullshit. Don’t-believe-your-lying-eyes kind of bullshit. Anybody who did not know it was utter bullshit is an idiot.

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  5. Brent Nyitray's avatar
    Brent Nyitray, on January 3, 2025 at 6:20 pm said:

    The LV bomber’s manifesto (assuming the press isn’t lying about it) will prove to be one hell of a national Rorsach test.

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  6. Let the mutherfuker burn!'s avatar
    Let the mutherfuker burn!, on January 3, 2025 at 7:45 pm said:

    Well, you can’t say homie ain’t transparent!

    https://redstate.com/bonchie/2025/01/03/donald-trump-just-made-the-most-hilarious-political-appointee-announcement-in-presidential-history-n2183936

    Why she would take the job after that speaks more about her lust for power than anything else.

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  7. Let the mutherfuker burn!'s avatar
    Let the mutherfuker burn!, on January 3, 2025 at 8:26 pm said:

    But Kash Patel will be bad for the FBI?

    https://redstate.com/terichristoph/2025/01/03/fbi-failed-to-secure-home-of-nola-terrorist-n2183926

    my God, what does it take for Lefties to think someone’s incompetent at heading an organization?

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    • Arcanaut's avatar
      Arcanaut, on January 5, 2025 at 12:13 pm said:

      The idea that “scientists” get some additional priestly reverence that is beyond questioning has always been retarded, on this, global warming, and every other topic. They are human beings and as likely to lie, be wrong, fall in love with bad ideas, or be incompetent as anybody else. They should always have to answer questions in good faith and show the receipts. In detail.

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  9. Let the mutherfuker burn!'s avatar
    Let the mutherfuker burn!, on January 6, 2025 at 11:02 pm said:

    Won’t it make it harder to set up Trump for the next collusion hoax?

    Kind of cutting off your nose to spite your face, but whatever.

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  11. Let the mutherfuker burn!'s avatar
    Let the mutherfuker burn!, on January 7, 2025 at 6:30 pm said:

    Absolutely delicious!

    It’d be great if there was a way to refile this with just Zuckerberg video. Alas…

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