MBA mortgage applications fell by 3.3%
According to the Mortgage Bankers Association of America, the US (IVV) (SPY) (VOO) MBA (Mortgage Bankers Association) index fell 3.3% in the week ending on March 18, 2016. MBA mortgage applications fell by the same percentage in the week ending on March 11, 2016. Since February 19, 2016, MBA mortgage applications are contracting. The fixed 30-year mortgage rate fell by 1 basis points and closed at 3.9% for the week ending on March 18, 2016.
The MBA is a leading indicator of home sales. This was the second weekly decline in the MBA index. A contraction in the MBA index directly impacts the financial sector. It’s one of the important beneficiaries of mortgage-related activities.
However, real estate stocks such as Simon Property Group (SPG), General Growth Properties (GGP), and the Macerich Company (MAC) rose 9%, 3%, and 1.4%, respectively, from February 1, 2016, to March 18, 2016.
Why is the MBA index important for investors?
The MBA index is the leading indicator of home sales. When consumers are buying homes, they’re also purchasing everything else. When they aren’t buying homes, the economy finds itself in trouble. Falling home sales show that the economy isn’t advancing.
In the next part, we’ll analyze the main indicators that will come out in the next week. We’ll discuss how the indicators will impact the Market.