Mortgage Applications Slip as Purchase Demand Falls Again

I got to drop Marsha off her Good morning everybody. I'm Ed Parkel here with Mike Keller, Real Estate Turkey Daily. This is it, Wednesday. That's right. How's it going? Oh, you know, I'm getting a little tired of the dogs. The dogs needing so much attention cuz they had their nuts clipped off. Actually, they leave those little dangly things now. They just go in and do like the vasectomy thing. I don't know what they No, they usually take them out. They're still there. Or there's something there hanging. Yeah, that's called that's called a sack. Leftover sack that has to shrink. Yeah, well, hopefully it shrinks fairly soon. Yeah, it takes about a year. Be glad they didn't have them for two years because it takes even longer.

Yeah. Ask George. He still has it on warm days. He still has his little sack popped down. Anyway, let's move on from the abuse of our dogs. Yeah, Penelope was in yesterday. Supposedly was going to get some teeth pulled because they were bad. And then they were like, oh no, we just did a really good cleaning. They were fine. They're fine. Yeah. Well, that's that's $700 versus the two grand. Could you put some gold and diamonds in her teeth for that price, please? For the 700 or the two grand? The 700. Yeah. Some gold caps. She seemed happy this morning when I walked in. Yeah, well, she had a good nap. Well, you know, I I read something about dogs when they do their forward stretch, you know, when they reach their paws out and they do this big stretch means they're very comfortable in your presence.

And she did that to me this morning. Well, they also when they lay away from you and put your their butt towards you, they're comfortable. But let's move on. We don't Nobody cares about that kind of stuff. Well, I bet there's like four people. Oh, let's see here. You want to go first? I can. What's this? Bam. Um, what do we have? 125 closed. Through the roof. Yeah, we are We are flying and the pendings are still staying kind of upwards. And that's more than that's almost three quarters of a month done. Yeah, and uh what was it? Did we take a look at this yesterday? It was 770 listings. Now it's 768. 389 pendings. So things are selling cuz we were about 380 I think we were 389 yesterday, but 125 have closed.

And that's we were We were We were begging for closing. Yeah. I mean, but pendings are being replaced as quickly as the closings are happening. So that's a good thing. I know, but the question Yeah, but it's only 125. I know and we're what, third week in? That's what I'm saying. We're three quarters of the month done. Yeah, well, we It's always at the end, the end of the month. It is It is at the end of the month where it just goes pop. I know, but the reason I wanted you to keep showing these week daily is to show how where if the market's moving and what's going on and everything else because, you know, March and April we had 325 and we don't have that right now. Right. No, we don't. And so And these these last few months, the June, July, the August are are usually some of our busiest months.

You know, people always say what's the best time to buy and I always say 10 years ago or today, maybe yesterday depending on the bond market. And it was okay, right? Yeah. Well, today we got stocks up, bonds up, and oil up. Trifecta. Trifecta. Yeah. And this is episode 615 of the Real Estate Turkey Daily. No way. Yeah. And uh Dow sitting at 195 right now. The uh 10 year is at 4. 6565. So we went from 4. 70 down to there. So we're down about six basis points. So that means rates are better by about 10 basis points this morning. Nothing majorly, but what the big news was um the fact that uh they're moving higher after announcement from the Treasury stated that they're going to double the size of their buyback operations of longer dated treasuries including 10 year, 20 year, and 30 year.

The biggest problem prior to this and the prior Fed people in charge, they were buying them but they were only buying the short-term stuff. They weren't buying the long-term. Yeah, so they finally came back and said now we're going to start buying the long-term. That's that will help rates, but then a lot of people are going to say we're just buying our They're going to start, you know, complaining that we did that. But I don't care. I want everything done to help in this market cuz right now we need the help because of the fact that the oil keeps going up because of the straight of Hormuz, you know, and all that stuff that's going on over there. Is there something going on over in Strait of Hormuz?

Yes, there is. But there's also supposedly the UAE just announced that they're not going to support Iran anymore. So that's good finally. Good. Good bastards. Yeah. Yeah. I feel sorry for the real Iranian people. So the Treasury started their buyback operations in 2024 and doubled its size in 2025 to 2 billion per operation or roughly 2. 7 billion per month in 10 year treasuries. That's what I'm talking about. They announced this morning that they're going to double their operation size again starting September 9th, which means they will buy about 5. 5 billion per month. While this is not a huge amount compared to some of the quantitative easing in the of the past, we have seen from the Fed, but it's giving bonds a boost right now.

So I got to take my leg brace off. Okay. We got to give bonds a boost. I'm not very You disconnected your leg. Threw it in the corner. Yeah, I was I took it off. It was bothering me. So that's what's going on. What else do we have today? I think we only had What comes out on Wednesday? Oh, that's right. Mortgage Banker Association released mortgage applications data for the week ending 8/14. That's last week. Showing that overall application volume decreased by 4/10 of a percent. Applications to purchase were down 2% for the week and down 3% year over year. Refinances increased 1. 5% from the previous week and are 18% lower than a year ago. Damn. So yeah, it's pretty Yes, it is. Uh but that's and that's all again what we keep talking about.

It's what's going on in the over there in Iran that's messing with oil even though only 5. 5 barrels are affected, million barrels a day are affected. It's still causing problems and yeah. So I think we talked about this yesterday. Pending home sales for NAR released for July which measured signed contracts on existing homes. The report showed that pending sales fell 2. 3% last month. This was weaker than I can't even talk today. This was weaker than the slight gain expected, but there was a 6/10% revision in June higher which makes today's totally a miss. And that's what we're seeing right now. You said pending sales were good on our end, but that's what we're seeing in areas where there's not a lot of inventory and this is in California.

We don't have a lot of inventory. We're not seeing a ton of pendings, but we're also not seeing drops in value. We're seeing that it's still staying strong. Yeah, unlike Texas and Florida, I talk to so many people in those places and it's it's ugly. Pretty stable. It's bleak. Yeah, unfortunately I'll be there on Friday. I got to love the 104 and probably 90% humidity. Yeah, exactly. And at least at nighttime it cools down to 81. Yeah, 81 and the humidity is still It's still there. That's like if you watch that new show not Yellowstone but the other one with, you know, with Dutton Ranch? Yeah, yeah, and they're like she comes out, how can it be so hot in the morning? That's Texas for you. You're in a desert kind of.

You're not in a desert. You're in Texas where the You got to remember we have the Pacific Ocean which is cold. So the air comes across there and it cools us down. They have the yeah, and other people have the sea. Yeah, and that that is not cold. That is warm. And so they don't cool down. We're lucky. East Coast some in some areas get the cool, but the other areas don't like Florida and stuff like that. Yeah. Yeah. Tropical. Tropical warm ocean. Yeah, I'd rather have the Pacific. Yeah, I like the Delta breeze. Really? So I sat in the backyard with the dogs for an hour and a half this morning hoping they would pee or poop. Oh, that's too long. I would just leave them outside. I guess I guess surgery has a way of screwing up your I don't know.

Last time you had George, did your wife take you outside then watch you for an hour to see if you pee and poop? She left me in the backyard for an hour and a half yesterday and nothing happened. Yeah, thank God. I did rest. Oh, we just got a message from our illustrious producer. What? Well, he wants us to handle everything? No, he connected early. Well, that is early. Yeah. A good thing we don't have much today. We don't. I mean, there's we talked about the supply stuff and everything else we'll talk about tomorrow or on Saturday on the radio show. According to Let's just talk about some state numbers real quick because we talked about Stanislaus County. According to Redfin, we're at 106,880.

Now those are just single family homes and they say that's down 6% year over year, which was the same last week as well. And then realtor. com which looks at everything, you know, single family one to four, condos and town homes, 156, 148. What did we used to be in the heyday when we had so much inventory? 450,000. What are you talking about? Inventory? Properties for sale. That was No, that was not the heyday. That was the bad days. That was the We were 250 to 400,000 a week during the the Great Recession. The recession. That was really a depression, but that's where they how that administration and the next administration always changes the definition of things. But since you brought up the California and then we'll close here, but I'm still the 19% problem.

CAR second quarterly affordability index. 19% of California households can afford the median price home in California. Median is 916,750. You need about 228,400 in income to make the 5,710 payment and that's just principal and interest. That's crazy. Explain to people what the median is. That is not an average. That is how many houses sell above and how many houses sell below and they pick the thing. That's right there. Abe just throws a dart and that's where the median is. Yeah, 916,000? Yes, 750. Yeah. That's crazy. The median. Our median is less than half the state in here in our area. Yeah. Yeah. And we four we're four 054 Vanessa median is 455. Oh, 455. Yeah, roughly half the income. Same 30 year rate, different life.

Expensive groceries. Yeah, Sacramento lawmakers are moving 11. 25 billion affordable housing bond towards the November ballot. I bet you they're going to steal it. Did you see the newest infomercial or the commercial against the billionaire tax? No. You know, they were they were saying this is a billionaire tax. Now you remember where they were going to tax all the rich people for income tax and then they weren't going to The billionaire ones. Yeah, and then they said oh well, they found loopholes and so we're going to have to tax all of you. They're going to tax all of us. I know it is. I know. So people wake up, pay attention, read some stuff and vote against it. California housing plan calls for roughly 2.

5 million new homes this cycle through 2030 and guess what? We're not on pace. No, really? No, the state's looking harder at buildings, how to do it, hotels, motels, empty retail, medical offices. This is almost as bad as the we're going to have everybody assume everybody's mortgages a couple years ago when everything changed and then it didn't work. This stuff doesn't work. You can't certain buildings can't because of how the foundations are and how certain supports are. So again, there's another program that's not going to work that just sounds good. It does sound nice, does it? But let's But I mean, there's only four statewide jurisdiction. Thank you. That are going to hit their targets across all levels.

Irvine, Orange County, Ontario, Fontana, Fontana. Oh, Fontana. I like Fontana too. San Diego and Bakersfield. Bakersfield's the only valley name on the list and actually the only name up in this area, right? Yeah. Cuz Ontario's not up here. Everything's down south. Yeah, exactly. And that tells you that Orange County knows what they're doing. Go ahead. Or so it looks like. Yeah. Buck Owens, right? He's he's the famous Bakersfield guy? No, he's Buck Owens is Oildale right next to Bakersfield. Yeah, it's It's the town, but it's not exactly the town. So We got aging motels on every corner in the valley. Is that true or not, Mike? Pretty true. Yeah. Pretty pretty darn true. And you know, it's kind of sad they're not going to tear down the DoubleTree.

Cuz it's aging. Think about how long that thing's been Oh, it's I remember years ago how bad the rooms look. I can only imagine today. Yeah, it'll be All right, let's go. Hey, everybody have a fantastic Wednesday. Yeah. Pretend it's Thursday so then your week's longer. Exactly. Okay, bye. Don't do what Mike said. All right, make it a great day. We'll be back tomorrow. Bye. Bye.