New applications for mortgages jump

This chart shows the Mortgage Bankers' Association purchase index, which includes all mortgage applications for the purchase of a single-family home. Since its low of last July, the index is up over 20%—a good sign that the housing market is firming rather than headed for another cliff. Purchase activity is still very depressed from a recent historical standpoint, of course, but on the margin it is moving in a positive direction. As the next chart shows, activity today is roughly the same as it was in 1997, just before the big housing boom got started.