Applications for new home purchases plummeted in August, pointing to continued weakness in a market segment that has disappointed throughout the year. The Mortgage Bankers Association's Builder Application Survey tumbled 9 percent month-over-month in August, according to the latest from the group. Based on application volume collected by mortgage subsidiaries of homebuilders nationwide, the MBA estimates new home sales last month ran at a seasonally adjusted annual rate of 424,000. That’s down 2.1 percent from the association's estimate of 433,000 for July.
The anticipated decline follows a nearly 2 and a half percent drop in July new home sales as reported by the Commerce Department. According to initial estimates from the government, sales that month were at an adjusted annual pace of 412,000. On an unadjusted basis, the MBA estimates August saw 34,000 new home sales, a monthly decrease of 8.1 percent.
A new survey released by the Wall Street Journal finds most don't expect the Federal Reserve to begin raising interest rates until mid-summer 2015 or later. In a poll of economists nationwide, the Journal found only about a third believe the Fed will start hiking up rates before June next year. That number is down from 45 percent of economists in the publication's August survey. The decline came after the government released its August employment summary, reporting the addition of only 142,000 new jobs after what had been a promising streak of 200,000-plus gains. With the end of the Fed's monthly bond-buying program apparently close at hand, Chairwoman Janet Yellen has said the central bank would wait for a considerable time after the program stops before raising rates, though she also said that time may arrive earlier if the labor market continued to make great strides.