Real Estate
While not a perfect indicator this shows the activity of mortgage applications. A low volume of mortgage applications means people aren’t buying houses.
source: tradingeconomics.com
This chart indicates if housing prices are overvalued or undervalued based on mortgage rates. It’s not intended to be perfect. However, when these lines diverge it means that either mortgage rates need to fall or housing prices need to fall. House prices on this chart are inverted.
Rental index
Housing Inventory – The higher this goes the more options for buyers. Prices will come down. The lower it goes prices will go up due to low inventory.
The affordability of houses is essential. This chart oscillates up and down. When it’s high it’s a bad time to buy and a good time to sell. The inverse is also true.
Mortgages can only outrun income for so long.
This chart tells you if 30-year mortgage rates are high relative to 10-year treasuries. This is a short-term indicator. If it’s high don’t get a mortgage. Wait for it to oscillate back down. These are highly correlated so they should revert to the mean.
As indicated above these two are highly correlated.
