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Today’s weak report on 2nd quarter gross domestic product is welcome news for mortgage shoppers.

Real gross domestic product grew at an annual rate of 1.2% in the 2nd quarter, according to the Department of Commerce. The market expectation had been more like a 2.6% increase.

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The yield on the 10-year Treasury fell on the news. Not a lot — around 0.03% — but this means there is no upward pressure on mortgage rates today. They might not fall, but you might get a better deal with discount points.

The slower-than-expected GDP growth “shows the economy barely above water,” says Lawrence Yun, chief economist for the National Association of Realtors.

Residential investment fell at a 6.1% annual pace, according to the GDP report. Yun blames that on weaker single-family housing starts in the 2nd quarter compared to the 1st quarter. “Going forward, GDP should avoid recession for the simple reason that more new homes need to be constructed,” Yun adds. “America is experiencing a housing shortage crisis. More homes need to be built and that in turn will lead to faster economic growth.”

I agree that more homes need to be built. The millennials, the biggest generation in American history, are growing up, moving out, forming families and they need places to live. But I’m not sure that Yun and I and millennials are going to get our wish soon. I’m eager to find out why homebuilders aren’t meeting demand.

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