Mortgage Applications Increased 8.1% in the US Last Week

In the last week, mortgage applications increased by 8.1% last week as cheaper borrowing costs persuaded more Americans to seek loans for home purchases and refinancing.

The Mortgage Bankers Association’s index of applications to buy a home or refinance a loan gained 8.1 percent to 656.5 from 607.1 the prior week.

The housing market has been fairly weak recently, as American Home Mortgage went bankrupt and HBOS and Bear Stears as well as other mortgage stocks are suffering from mortgage fears on Wall Street.

Mark Vitner, senior economist at Wachovia Corp. in Charlotte, North Carolina said: “We’re at the bottom right now in housing. The biggest declines are over.”

However, Sam Kirtley of The Gold Prices Newsletter disagrees: “The US is in for a major real estate crash. The housing bubble has been over inflated by cheap, easy credit and the US government printing more and more dollars to keep it going. This is only the beginning, it has started in the sub prime market but it will spread to the rest of the real estate industry.”

What do you think?

Are we in for more trouble in the housing and mortgage markets?

Perhaps the Fed should lower interest rates to boost mortgage and housing companies.

Source

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