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There has been talk circulating that the Administration is considering the re-authorization of the expired homebuyer tax credit. While I believe this would be taking a step in the wrong direction, I do feel the housing market needs to provide more incentive to buy than record affordability. Economic and political outlooks are too up in the air and buyers are in no rush to sign a sales contract. What the housing market does not need is government officials mentioning that incentives will be implemented "if needed". Just talking about another homebuyer tax credit could slow sales in the here and now as consumers put off purchase plans in hopes they too will be able to benefit from new stimulus measures. There is no time for dilly-dallying here, the negative feedback loop is already in process. The Administration must either squash the idea of more stimulus, with blunt force, or act quickly to implement new measures so buyers can make informed decisions. Either way....communication is key....

In last week's release, which reported data for the week ending October 16, mortgage application activity fell 13.7% as mortgage rates rose from 5.02% to 5.07%. The Refinance Index, adjusted for the Columbus Day holiday, decreased 16.8% from the previous week while the seasonally adjusted Purchase Index moved lower as well, decreasing 7.6% from one week earlier. The refinance share of mortgage activity fell to 65.0% of total applications from 67.4% in the previous week. In today's release, which covers new loan applications for the week ending October 23, the MBA reported that demand for new mortgages dropped 12.3%, even as mortgage rates fell from 5.04% to 5.07%. ...