Tracking the Reopening: US Mortgage Applications Rebound
With Massachusetts and Connecticut partially reopening this week after the pandemic-related lockdowns, all 50 states in the US have more or less begun the process of jumpstarting their economies. Tracking the Reopening series intends to map and analyze the nascent datapoints that are emerging from the US and elsewhere in the wake of such reopenings.
While debates rage on regarding the ultimate shape of the broader economic recovery in the United States, there is at least one indicator that points to a possible V-shaped recovery. Mortgage applications, which were down as much as 35% YoY several weeks ago, have since rebounded so strongly that they are now a mere 1.6% lower than a year earlier. That this rebound occurred despite the surging unemployment rate is one of the several data incongruences that support our more positive macro view relative to consensus estimates.
Lower mortgage interest rates are no doubt a powerful incentive, but that would not be enough of an enticement if consumers were truly worried about the longer-term economic outlook. The data aligns with recent homebuilder comments as well, indicating a better-than-anticipated housing demand recovery. We are also intrigued by the National Multifamily Housing Council data that track 11.4 million apartment units. The data show that 87.7% of tenants have made at least partial rental payments through 13 May, which is just 2.1 percentage points lower compared with the 2019 period and 2.7 percentage points better than in April. At the very least, there is some encouraging resilience here!
The whole or any part of this work may not be reproduced, copied or transmitted or any of its contents disclosed to third parties without State Street Global Advisors’ express written consent.
The views expressed in this material are the views of Simona Mocuta through 22 May 2020 and are subject to change based on market and other conditions. This document contains certain statements that may be deemed forward looking statements. Please note that any such statements are not guarantees of any future performance and actual results or developments may differ materially from those projected.
All information is from SSGA unless otherwise noted and has been obtained from sources believed to be reliable, but its accuracy is not guaranteed. There is no representation or warranty as to the current accuracy, reliability or completeness of, nor liability for, decisions based on such information and it should not be relied on as such.
The information provided does not constitute investment advice as such term is defined under the Markets in Financial Instruments Directive (2014/65/EU) and it should not be relied on as such. It should not be considered a solicitation to buy or an offer to sell any investment. It does not take into account any investor’s or potential investor’s particular investment objectives, strategies, tax status, risk appetite or investment horizon. If you require investment advice you should consult your tax and financial or other professional advisor.
The trademarks and service marks referenced herein are the property of their respective owners. Third party data providers make no warranties or representations of any kind relating to the accuracy, completeness or timeliness of the data and have no liability for damages of any kind relating to the use of such data.
Before investing, consider the funds' investment objectives, risks, charges and expenses. To obtain a prospectus or summary prospectus which contains this and other information, call 1-800-997-7327, download a prospectus or summary prospectus now, or talk to your financial advisor. Read it carefully before investing.
Distributor: State Street Global Advisors Funds Distributors, LLC, member FINRA, SIPC, an indirect wholly owned subsidiary of State Street Corporation. References to State Street may include State Street Corporation and its affiliates. Certain State Street affiliates provide services and receive fees from the SSGA Funds.
THIS SITE IS INTENDED FOR U.S. INVESTORS ONLY.
No Offer/Local Restrictions
Nothing contained in or on the Site should be construed as a solicitation of an offer to buy or offer, or recommendation, to acquire or dispose of any security, commodity, investment or to engage in any other transaction. SSGA Intermediary Business offers a number of products and services designed specifically for various categories of investors. Not all products will be available to all investors. The information provided on the Site is not intended for distribution to, or use by, any person or entity in any jurisdiction or country where such distribution or use would be contrary to law or regulation.
All persons and entities accessing the Site do so on their own initiative and are responsible for compliance with applicable local laws and regulations. The Site is not directed to any person in any jurisdiction where the publication or availability of the Site is prohibited, by reason of that person's nationality, residence or otherwise. Persons under these restrictions must not access the Site.
Information for Non-U.S. Investors:
The products and services described on this web site are intended to be made available only to persons in the United States, and the information on this web site is only for such persons. Nothing on this web site shall be considered a solicitation to buy or an offer to sell a security to any person in any jurisdiction where such offer, solicitation, purchase or sale would be unlawful under the securities laws of such jurisdiction.
Not FDIC Insured * No Bank Guarantee * May Lose Value