Condo Market's Loss Is Apartment Market's Gain
Builder confidence in the condo market dropped dramatically in the second quarter of this year, while confidence in the apartment market hit record highs.

There is "clearly an oversupply" of unsold condo units, NAHB Chief Economist David Seiders says. Vacancy rates for apartment buildings are dropping and rents are increasing, he says.

That's because apartment-to-condo conversions shrunk the rental market and boosted apartment demand, says Leonard Wood of Marietta, Ga.-based Wood Partners.

Bruce Menin, president of Crescent Heights, a New York City-based developer of high-rise condominiums, cautions local governments against requiring a large number of low-income units, as this could prevent developers from proceeding and result in a lean supply and higher prices in tight markets.

Wood, meanwhile, warns that impact fees and stricter building codes could hamper construction.

Mortgage Apps Increase as Rates Ease
Applications for U.S. mortgages have rebounded in response to falling interest rates, the Mortgage Bankers Association reports.

The seasonally adjusted index of total mortgage applications rose 11.9 percent in the week ending Sept. 29 to 633.9. That’s its highest level since January, but on an unadjusted basis it is 10.9 percent lower than it was a year ago last week.

Nearly half of the applications are for refinancing as homeowners with adjustable rates trade them for fixed rates. At 46.7 percent, this is the highest that the refinance share has been since February 2005.

The average interest rate for 30-year fixed-rate mortgages increased to 6.24 percent from 6.18. The average interest rate for 15-year fixed-rate mortgages increased to 5.86 percent from 5.81 percent. The average rate for a one-year ARM decreased to 5.86 percent from 5.90.