This article presents a summary of housing indicators, which have shown some improvement in January.

 

The Federal Reserve bought $22.3 billion in MBS over the period Jan.29 through Feb. 4 for, an average daily purchase amount of $4.5 billion.

 

This increased from the previous week's daily average of $3.4 billion. To date, the Federal Reserve has bought $91.7 billion in agency MBS, which leaves $408.3 billion to go based on their current plan.

 

Fannie Mae purchases represented 47.2% compared to Freddie Mac's 43.6%, while GNMAs represented just 9.2% of the total. The percentage of 30-year MBS buying was 93.3%. By coupon, the largest purchases were in 4.5%s (37%), 5.5s (20.4%), and 6s (17.9%).

 

Meanwhile, the National Association of Realtors (NAR) reported its Pending Home Sales Index for December rose 6.3% to 87.7, while November's was revised slightly higher to 82.5 from 82.3. The gain was attributed to lower mortgage rates and lower home prices as reflected in the NAR's Housing Affordability Index that rose 10.9% to a record high 158.8.

The Senior Loan Officers Opinion Survey for January suggested some stabilization regarding the tightening in credit standards. In the latest survey, 57.1% of large bank respondents reported their credit standards on prime loans remained almost the same while 42.8% reported tightening over the survey period.

In the October report, 20% had reported basically unchanged standards while 80% had tightened their standards.

On the demand side, there was stronger demand for prime mortgages. 25% of large bank respondents indicated "moderately stronger" to "substantially stronger" demand versus 0% in October.

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