10
Dec
By First Rate Financial Group
Financial Reports

What’s Ahead For Mortgage Rates This Week – December 10th, 2018

What's Ahead For Mortgage Rates This Week - December 10th, 2018Last week’s economic reports included readings on construction spending and Labor Department readings on private and public jobs growth. The Consumer Sentiment Index was released along with weekly readings on mortgage rates and new jobless claims.

Construction Spending Slows in October

Residential construction slowed in last month as public works projects increased. Private sector construction spending fell by -0.10 percent as compared to expected growth of 0.30 percent and last month’s negative reading of -0.10 percent.

Construction spending for October was $1.309 billion on a seasonally adjusted annual basis as compared to September’s revised reading of $1.311 billion. Overall construction spending was 4.90 percent year-over-year.

Homebuilders continued to be wary of tariffs on building materials and cited high labor costs and a shortage of buildable lots. Winter weather also slows construction in many areas of the U.S.

Mortgage Rates, New Jobless Claims Fall

Freddie Mac reported lower average mortgage rates last week. Mortgage rates for a 30-year fixed rate mortgage fell by six basis points to 4.75 percent; rates for 15-year fixed rate mortgages were four basis points lower at 4.21 percent on average.

Rates for 5/1 adjustable rate mortgages averaged five basis points lower at 4.07 percent. Discount points averaged 0.50 percent for 30-year fixed rate mortgages and 0.40 percent for 15-year fixed rate mortgages. 5/1 adjustable rates had average discount points of 0/30 percent.

First-tome jobless claims were lower last week with 231,000 new claims filed as compared to an expected reading of 224,000 new claims filed and the prior week’s reading of 236,000 new jobless claims filed.

Labor Department: Slower Jobs Growth in Public, Private Sectors

The Bureau of Labor Statistics reported fewer jobs added to Non-Farm Payrolls in November. 155,0000 public and private sector jobs were added as compared to expectations of 190,000 jobs added and October’s reading of 237,000 new jobs added. ADP reported 179,000 private sector jobs added in November as compared to 225,000 jobs added in October. The national unemployment held steady at 3.70 percent.

Consumer sentiment was unchanged in November with an index reading of 97.50 according to the University of Michigan’s Consumer Sentiment Index.

What‘s Ahead

This week’s scheduled economic releases include readings on inflation, retail sales and weekly reports on mortgage rates and first-time jobless claims.

 

06
Dec
By First Rate Financial Group
Financial Reports

Newest Home Pricing Data Shows Homes Becoming More Attainable Across The Country

Newest Home Pricing Data Shows Homes Becoming More Attainable Across The CountryCase-Shiller’s 20-city home price index for September reported the lowest pace of year-over-year home price growth in almost two years. Lower home prices balanced housing markets between sellers and buyers, but home prices continued to grow approximately two times faster than wage growth.

Case-Shiller’s 20 city home price index for September posted a home price growth rate of 5.20 percent as compared to August’s year-over-year growth rate of 5.70 percent. While analysts expected slower rates of home price growth, they weren’t expecting the steep declines seen in September’s report.

David Blitzer, Chairman and CEO of the S&P Dow Jones Indices Committee, said “Home prices plus data on house sales and construction confirm the slowdown in housing.”

Las Vegas Holds on to Top Spot in Home Price Growth

Las Vegas, Nevada had the highest pace of home price growth with a year-over-year reading of 13.50 percent; San Francisco, California posted a year-over-year home price growth rate of 9.90 percent. Seattle, Washington held third place in year-over-year home price growth with a reading of 8.40 percent.

Las Vegas home prices, while leading the 20-City Home Price Index, remained 20 percent lower than their peak. Nine cities saw home prices decline in September as compared to August; Seattle, Washington posted a negative home price growth reading of -1.30 percent from August to September.

The National Association of Home Builders reported the third consecutive quarterly decline in the number of Americans expecting to buy homes within the next twelve months. As demand for homes declines, home prices are expected to fall as inventories of available homes rise.

These conditions will soften the impact of strong buyer competition and skyrocketing home prices common in recent years, but home prices remain unaffordable in many areas.

Home Buyers Deal with High Home Prices

Home buyers are finding ways to adjust their home searches to get around affordability issues. A recent survey by the National Association of Home Builders indicated 61 percent of home buyers would continue looking for a home they could afford.

40 percent of buyers said they would expand their search areas and 23 percent of responding home buyers said they would look for homes older or smaller than they originally planned to buy.

As always, contact your trusted real estate professional to discuss the latest activity in your local market.

26
Nov
By First Rate Financial Group
Financial Reports

What’s Ahead For Mortgage Rates This Week – November 26th, 2018

What’s Ahead For Mortgage Rates This Week – November 26th, 2018Last week’s economic readings included readings from the National Association of Home Builders Housing Market Index, National Association of Realtors® report on sales of pre-owned homes and Commerce Department readings on housing starts and building permits issued. Weekly reports on mortgage rates and first-time jobless claims were also released.

Housing Market Challenges Catch Up to Builder Sentiment

According to the National Association of Home Builders, overall builder sentiment fell six points to November’s reading of 60. This was the largest decline in builder sentiment since 2016. Ongoing concerns over lot and labor shortages and rising costs of building materials were cited along with recently rising mortgage rates.

Demand for homes eased as potential buyers were sidelined by rising rates, shortages of homes for sale and approaching winter weather and holidays. Any Housing Market Index reading over 50 is considered positive, but steep drops in builder sentiment is considered a predictor of stabilizing market conditions.

National Association of Realtors®: Sales of Pre-Owned Home Sales Rise in October

Sales of previously-owned homes rose in October to a seasonally-adjusted annual rate of 5.22 million sales as compared to September’s reading of 5.15 million sales. Analysts estimated a reading of 5.18 million sales. While this reading suggests that buyers are active, an increase in home sales signals easing demand as compared to recent months when many buyers were sidelined due to extreme buyer competition for short inventories of homes for sale.

Mortgage Rates First-Time Jobless Claims Fall as New Jobless Claims Rise

Freddie Mac reported lower mortgage rates last week; rates for 30-year fixed rate mortgages averaged 4.81 percent, which was 13 basis points lower than the previous week. Rates for 15-year fixed rate mortgages averaged 4.24 percent and were 12 basis points lower.

Rates for 5/1 adjustable rate mortgages averaged 4.09 percent and were five basis points lower. Discount points averaged 0.40 percent for 30-year fixed rate mortgages, 0.50 percent for 15-year fixed rate mortgages and 0.30 percent for 5/1 adjustable rate mortgages.

First-time jobless claims rose last week to 224,000 new claims filed as compared to expectations of 215,000 claims. The prior week’s reading was 221,000 new claims filed.

What‘s Ahead

Economic readings set for release this week include Case-Shiller home price indices, new home sales and pending home sales. Weekly readings on mortgage rates and new jobless claims will also be released.