24
Aug
By First Rate Financial Group
Financial Reports

What’s Ahead For Mortgage Rates This Week – August 24, 2020

What's Ahead For Mortgage Rates This Week - August 24, 2020Last week’s economic news included readings from Case-Shiller on home prices, the National Association of Home Builders Housing Market Indices, and sales of previously-owned homes. Readings on housing starts and building permits issued were released. Weekly reports on mortgage rates, new and continuing jobless claims were also published.

NAHB: Home Builder Confidence Rises in August

The National Association of Home Builders reported that builder confidence in housing market conditions rose six points to an index reading of 78.in August. The expected reading of 73 was based on July’s reading of 72. Homebuilder confidence was based on sharp demand for homes as city dwellers sought larger homes in less dense housing metro areas.

Ongoing shortages of pre-owned homes for sale boosted builder outlook as would-be buyers turned to new homes as supplies of pre-owned homes remained low.

The National Association of Realtors® reported higher numbers of previously owned homes sold in July at a seasonally adjusted annual pace of 5.86 million sales. 5.50 million sales of previously owned homes were expected based on June’s seasonally adjusted annual pace of 4.70 million sales.

Rising home sales could indicate increasing numbers of available homes, rising confidence in the economy, and sellers putting their homes on the market for reasons including buying bigger homes or relocation for less congested living conditions.

Commerce Department Reports Rising Rates of Housing Starts and Building Permits Issued

The Commerce Department reported a jump in U.S. housing starts in July with a seasonally adjusted annual rate of 1.496 million starts as compared to an expected pace of 1.330 million housing starts and an annual pace of  1.258 million housing starts reported in June.

Mortgage Rates Rise; Jobless Claims Mixed

Freddie Mac reported higher mortgage rates last week; the average rate for 30-year fixed-rate mortgages rose three basis points to 2.99 percent. Rates for 15-year fixed-rate mortgages averaged 2.54 percent and were eight basis points higher. Interest rates for 5/1 adjustable rate mortgages averaged one basis point higher at 2.91 percent. Discount points averaged 0.80 percent for 30-year fixed-rate mortgages, 0.70 percent for 15-year fixed-rate mortgages. Discount points for 5/1 adjustable rate mortgages averaged 0.30 percent.

Initial jobless claims reported by states rose to 1.11 million new claims filed last week and surpassed the expected a reading of 910,000 new claims filed based on the prior week’s reading of  971,000 initial jobless claims filed. Continuing jobless claims fell to 14.80 million ongoing claims from the prior week’s reading of 15.50 million continuing claims.

What’s Ahead

This week’s scheduled economic news includes readings from Case-Shiller Home Price Indices, reports on new and pending home sales, and inflation. Weekly reports on mortgage rates and jobless claims will also be released.

13
Jul
By First Rate Financial Group
Financial Reports

What’s Ahead For Mortgage Rates This Week – July 13, 2020

What's Ahead For Mortgage Rates This Week - July 13, 2020Last week’s scheduled economic news included readings on consumer credit, job openings, jobless claims, and mortgage rates.

Consumer Borrowing Declined at Slower Pace in May

According to Federal Reserve data, consumer borrowing fell at a slower annual pace of -5.30 percent in May as compared to April’s reading of -20 percent. Non-revolving consumer credit, which includes vehicle and student loans, increased by 2.30 percent in May. The Federal Reserve does not report on real estate loans.

Federal assistance programs including the first round of stimulus checks, additional unemployment payments and support for businesses contributed to better readings for the economy in May, but last week’s rising coronavirus cases may cause all or part of economic gains to be lost as local governments reverse decisions to reopen businesses and local government services.

Job Openings Rise  in May as Weekly Jobless Claims Fall

The Bureau of Labor Statistics reported 5.40 million job openings in May as compared to April’s 5.00 million job openings. Rising job openings coincided with reopening business and government services as state and local authorities eased stay-at-home requirements and began easing restrictions on economic activity.

Weekly jobless claims were also lower than for the preceding week. 1.31 million initial jobless claims were filed last week as compared to the prior week’s reading of 1.41 million first-time claims filed. Ongoing jobless claims fell to 18.10 million claims from the prior week’s reading of 18.80 million continuing jobless claims. Jobless claims remained much higher than pre-pandemic readings.

Mortgage Rates Drop to Record Lows

Freddie Mac reported the lowest recorded average mortgage rates as rates for fixed-rate mortgages dropped by four basis points to 3.03 percent for 30-year fixed-rate mortgages and fell by five basis points to 2.51 percent for 15-year fixed-rate mortgages. The average rate for 5/1 adjustable rate mortgages rose two basis points to 3.02 percent; discount points averaged 0.80 percent for fixed-rate mortgages and 0.30 percent for 5/1 adjustable rate mortgages.

The U.S. Senate is expected to work on its version of the next Coronavirus relief package next week; it should be completed by the end of July or in early August.

What’s Ahead

This week’s scheduled economic news includes reports on housing markets, housing starts, and consumer sentiment. Weekly readings on mortgage rates and jobless claims will also be released.

 

18
Nov
By First Rate Financial Group
Financial Reports

What’s Ahead For Mortgage Rates This Week – November 18th, 2019

What’s Ahead For Mortgage Rates This Week – November 18th, 2019Last week’s economic reporting included readings on inflation, testimony by Federal Reserve Chair Jerome Powell, and weekly readings on mortgage rates and new unemployment claims.

Rising Gas Prices Fuel Jump in Inflation

Consumer inflation increased at its fastest pace in seven months according to the Consumer Price Index for October. Consumer prices rose 0.40 percent and exceeded analysts’ forecast of 0.30 percent and September’s reading of 0.00 percent inflationary growth.  Analysts attributed the jump in prices to rapidly rising gasoline prices.

October’s reading for core inflation, which excludes fuel and food prices, supported this view. Core inflation grew by 0.20 percent in October, which matched expectations and exceeded September’s core inflation reading of 0.10 percent.

Year-over-year inflation rose from 1.70 percent to 1.80 percent; this was lower than the top year-over-year reading that approached 3.00 percent.

Fed Chair Says Interest Rates on Hold Unless Economy Deteriorates

In testimony before the Joint Economic Committee of Congress, Fed Chair Jerome Powell said,: “We see the current stance of monetary policy to remain appropriate as long as incoming information about the economy remains broadly consistent with our outlook of moderate economic growth, a strong labor market,  and inflation near our symmetric rate of 2.00 percent.”

Mr. Powell said that Federal Reserve Policy is flexible and subject to adjustment as required by future news and economic events. The benchmark Federal Funds rate range is currently 1.50 percent to 2.00 percent.

Mortgage Rates, New Jobless Claims Rise

Freddie Mac reported higher average mortgage rates last week. Rates for 30-year fixed-rate mortgages rose six basis points to 3.25 percent. Rates for 15-year fixed-rate mortgages rose seven basis points to 3.20 percent;  the average rate for 5/1 adjustable-rate mortgages rose five basis points to 3.44 percent.

Discount points averaged 0.60 percent for 30-year fixed-rate mortgages and 0.50 percent for 15-year fixed-rate mortgages. Discount points for 5/1 adjustable-rate mortgages averaged 0.40 percent.

225,000 first-time jobless claims were filed last week; this exceeded expectations of 210,000 new claims and the prior week’s reading of 211,000 new jobless claims filed. Analysts said the spike in new claims was caused by seasonal anomalies and not by layoffs. New jobless claims are likely to fall as the holiday season approaches and seasonal hiring picks up.

What’s Ahead

This week’s scheduled economic news includes readings from the National Association of Home Builders on housing market conditions; the Commerce Department readings on housing starts and building permits issued. Readings on sales of pre-owned homes and consumer sentiment will also be released along with weekly reports on mortgage rates and new jobless claims.