Just how bad is the U.S. housing market? After falling off a cliff in May, due to the expiration of the home buyer credit, sales continue to decline further and further. Last week, mortgage applications for home purchases fell by 3.1%, according to the Mortgage Bankers' Association. That broke through the worst levels seen in 1997, to hit a point not seen since 1996. They're now down 69.1% compared to their 2005 peak.
Here's the chart:
The green line represents last week's index value. If purchase applications decline much more, by another 4%, they will hit 1995 levels.
This news is particularly incredible in light of the fact that mortgage rates hit a new all-time low last week. Despite that, Americans still aren't buying houses. This shows very weak demand, more than two months after the home buyer credit expired.
This article available online at: