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Takeaway: Housing demand in November was the strongest month YTD and the first week of December continues that trend.

Our Hedgeye Housing Compendium table (below) aspires to present the state of the housing market in a visually-friendly format that takes about 30 seconds to consume.

Purchase Apps | November Reign - Compendium

Today’s Focus: MBA Purchase Applications

The momo in purchase demand continued in the latest week with seasonally adjusted weekly activity holding at 5-year highs and average monthly activity in November finishing at its highest level since mid-2013.

Purchase applications were flat sequentially (+0.05% WoW) at the 228.2-level on the Index with growth decelerating modestly to +28.4% YoY.  On a quarterly basis, 4Q is tracking +2.8% QoQ and +24.2% YoY. 

The read-through on this weeks data remains largely unchanged relative to the week prior (see: Purchase Apps | New Highs ...& Salt Grains): 

Conclusion - The high-frequency data remains hostage to seasonal noise associated with imperfect peri-holiday statistical adjustments and we’re probably observing some measure of demand pull-forward associated with the impending policy rate increase.  But, on balance, the 5-week streak of above trend demand suggests the uptick in purchase activity aptly characterizes the underlying reality– if not in magnitude, at least directionally. 

Purchase Apps | November Reign - Purchase Monthly Ave YTD

Purchase Apps | November Reign - Purchase YoY

Purchase Apps | November Reign - Purchase 2013v14v15

Purchase Apps | November Reign - Purchase Index   YoY Qtrly

Purchase Apps | November Reign - Purchase LT

Purchase Apps | November Reign - 30Y FRM

About MBA Mortgage Applications:

The Mortgage Bankers’ Association’s mortgage applications index covers more than 75% of mortgage applications originated through retail and consumer direct channels. It does not include loans delivered through wholesale broker and correspondent channels. The MBA mortgage purchase applications index is considered a leading indicator of single-family home sales and construction. Moreover, it is the only housing index that is released on a weekly basis. 


The MBA Purchase Apps index is released every Wednesday morning at 7 am EST.

Joshua Steiner, CFA

Christian B. Drake