First and foremost, we are not in the AB (America is Back) economic stage yet. Yesterday for Housing Wire, I wrote an updated piece on the 5 things I am looking for to get off the AD (After the Disease) stage and into AB.
I just wanted to go over today’s purchase application data to show that we need to mindful of extreme housing takes on social media sites. A lot of people went straight into the home price doom and gloom stage without providing an economic model to get there, and this happened.
Purchase Application Data 2020 Tracker
Positive 9% Week To Week
Positive 9% Year Over Year!
BC Data: Year over Year
BC data (Before Coronavirus)
+8%
+17%
+11%
+16%
+10%
+10%
+10%
+12%
+11% <- March 18th, 2020 Data
AD Data (After Disease)
-11%
-24%
-35%
-31%
-20%
-19%
-10%
-1.5%
+9%
Here was my take back on April, 10th.
AD Data: What Will It Take To Crush Home Prices
https://loganmohtashami.com/2020/04/10/ad-data-what-will-it-take-to-crush-home-prices/
I am keeping with my thesis that people should just put a big * on the March, April, and May housing data because it’s merely too wild due to the virus. I would wait until July 15th and take a look at all the June’s housing data and take it from there. Our economy took a massive shock from the virus and lockdown protocols. As we slowly move back toward the AB stage, we will have a more stable housing data to work from.
Remember, housing economics is primarily moved by demographics and mortgage rates, and for now, these two are the best ever in our country’s history. For now, take the worst-case off the table for the existing home sales market and look at the weekly economic daily closely.
From Fred: https://fred.stlouisfed.org/series/WEI
Logan Mohtashami is a financial writer and blogger covering the U.S. economy with a specialization in the housing market. Logan Mohtashami is a senior loan officer at AMC Lending Group, which has been providing mortgage services for California residents since 1987. Logan also tracks all economic data daily on his Facebook page https://www.facebook.com/Logan.Mohtashami and is a contributor for HousingWire.