Housing affordability is improving

The national average for 30-year fixed rate conforming loans has dropped by about one percentage point since the end of October. The current national average is now 5.74%, according to BanxQuote. As this chart shows, homeowners have not been asleep at the switch. Refinancing activity has soared, and applications for new mortgages are up 44% in the past two weeks. The combination of lower mortgage costs and lower housing prices is a potent antidote to the housing crisis. The market is moving rapidly to reprice the U.S. housing stock, which means the bottom in housing prices is rapidly approaching, and that is very encouraging news.