The MReport Webcast: Friday 12/12/2014

An early look at mortgage application activity suggests new home sales plunged in November as first-time homebuyers struggled to get a foot into the market. The Mortgage Bankers Association monthly survey of loan application volumes at home builders shows new home purchase activity was down 22 percent month-over-month in November, the group said Thursday. Looking at all indicators, MBA estimates new single-family home sales ran at a seasonally adjusted annual rate of 401,000 units last month, a 13 percent drop from the association's October estimate.

Home sales in October were at a seasonally adjusted yearly rate of 458,000, according to an estimate from the Commerce Department, up slightly from a revised September sales rate of 455,000. That number, which is subject to change in future reports, was more or less in line with MBA's prediction of 461,000. The government's new home sales estimate for November is due later this month.                                             

In a year that's seen promising but unspectacular growth, economists agree that one sector of the U.S. economy disappointed: the housing market. In a survey of 45 economists conducted by the Wall Street Journal, the panel largely agreed that throughout all of 2014, housing proved to be the weakest link in the economic chain, with weak household formations weighing down on demand and production. A year ago, economists surveyed by the Journal had predicted housing starts would surge 20 percent over 2014 to an annual rate of 1.11 million, a prediction that quickly fizzled as the year's opening months brought poor weather and even poorer home sales. As of December, the group now predicts starts will total a little more than one million.