US MBA Purchase Index (Nov/06) 141.2 (Prev. 131.4)

US MBA Purchase Index (Nov/06) 141.2 (Prev. 131.4)

The MBA purchase index is a weekly, seasonally adjusted series and one of the noisier high-frequency housing reads: single-week swings of this size have historically said as much about holiday timing and adjustment quirks as about underlying demand, and the series routinely retraces part of a sharp move in the following week. The relevant distinction within the survey is purchase applications versus refinancings: the purchase component is the cleaner proxy for housing demand, since it is less mechanically geared to week-to-week mortgage rate moves than the refi leg. A rise of this magnitude against the recent trend would typically be read alongside where the benchmark mortgage rate has tracked over the same window, as rate dips tend to pull forward applications with a short lag. Historically the index has fed through to pending home sales and, further out, to existing home sales, but only where strength persists across several consecutive weeks rather than appearing as a one-off. The follow-ons are next week's print for confirmation or reversal, the rate component of the same survey, and the homebuilder and housing-start data for cross-validation. As a second-tier weekly release it rarely re-prices rates or homebuilders on its own; its weight comes as corroboration of a housing trend already visible elsewhere.