Economics at your fingertips  

Can mortgage applications help predict home sales?

John Duca

Economic and Financial Policy Review, 1996, issue Q IV, 30 pages

Abstract: In this article, John Duca finds that the Mortgage Bankers Association (MBA) index of home mortgage applications can help forecast home sales. Alone, the index is a good, albeit imperfect, predictor of total home sales. But when included along with housing affordability and real, after-tax mortgage rate data, the index does not add extra information if one disregards differences in data release lags. ; The index is available roughly three to four weeks ahead of the two alternative indicators. Taking into account its greater timeliness, it provides some extra information on home sales beyond that in the two other indicators considered. Given this qualification, the MBA index can help predict overall home sales. In addition, the long-run equilibrium relationships suggest that its usefulness may increase in the future. Nevertheless, the index should be used cautiously. It is still relatively new, and evidence suggests it may be misleading under some circumstances.

Keywords: Housing; Mortgages (search for similar items in EconPapers)
Date: 1996
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed

Downloads: (external link) (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link:

Ordering information: This journal article can be ordered from

Access Statistics for this article

More articles in Economic and Financial Policy Review from Federal Reserve Bank of Dallas Contact information at EDIRC.
Bibliographic data for series maintained by Amy Chapman ().

Page updated 2019-08-15
Handle: RePEc:fip:fedder:y:1996:i:qiv:p:21-30