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

What’s Ahead For Mortgage Rates This Week – March 18th, 2019Last week’s economic reports included readings on retail sales, inflation and construction spending. New home sales Consumer sentiment readings were posted along with weekly readings on mortgage rates and first-time jobless claims.

Retail Sales Increase after Lowest Reading in 10 Years

Retail sales rose by 0.20 percent in January; analysts expected an increase of 0.10 percent based on December’s negative revised reading of -1.60 percent. Home centers and internet retailers led in overall sales; retail sales without the automotive sector were higher with an 0.90 percent increase in January, which exceeded expectations of an 0.40 percent increase.

December had a negative reading of –2.10 percent. Auto dealers had fewer sales to car rental firms and other business customers; the reading for retail sales excluding automotive sales rose 0.90 percent as compared to expectations of 0.40 percent more sales and December’s reading.

Inflation rose 0.20 percent in February, which matched expectations after a flat reading in January. Core inflation, which excludes readings for volatile food and fuel sectors, rose 0.10 percent, which fell short of 0.20 percent in January.

Construction Spending Rises as New Home Sales Fall

Commerce Department readings for construction spending rose 1.30 percent in January as compared to December’s negative reading of -0.80 percent. The end of the government shutdown likely helped return construction spending return to positive territory, but real estate and mortgage pros said that building more homes is the only solution to persistent shortages coupled with high demand for homes by would-be buyers.

Slim inventories and home prices rising in excess of wages and inflation are factors contributing to fewer eligible buyers. New home sales fell in January, which is not unusual for winter sales. 607,000 new homes were sold on a seasonally-adjusted annual basis in January; 652,000 new home sales were reported in December, but analysts expected a lower reading of 616,000 sales for January.

Mortgage Rates Fall as New Jobless Claims Rise

Freddie Mac reported lower average mortgage rates last week with rates for 30-year fixed rate mortgages averaging ten basis points lower at 4.31 percent. !5-year fixed rate mortgages averaged 3.76 percent after falling seven basis points. 5/1 adjustable-rate mortgages averaged 3.84 percent and were three basis points lower. Discount points averaged 0.40 percent for fixed-rate mortgages and 0.30 percent for 5/1 adjustable rate mortgages.

Initial jobless claims rose to 239,000 new claims last week; 223,000 claims were filed the prior week and analysts expected 225,000 new claims. Last week’s first-time jobless claims were the highest in ten years, but analysts said that layoffs haven’t risen significantly, which signals healthy labor markets.

The University of Michigan reported higher consumer confidence in March with an index reading of 97.80. The expected reading was 95.0 based on February’s index reading of 93.80. Increased consumer confidence in economic conditions suggests that more families will enter the housing market. Analysts said rising consumer confidence resulted from the resolution of the government shutdown.

What’s Ahead

Economic readings scheduled this week include reports on homebuilder confidence in housing market conditions, sales of pre-owned homes and Commerce departments on housing starts and building permits issued. The Federal Reserve’s scheduled announcement will be followed by Fed Chair Jerome Powell’s press conference. Weekly reports on mortgage rates and new jobless claims will also be issued.

What’s Ahead For Mortgage Rates This Week – March 11h, 2019

What’s Ahead For Mortgage Rates This Week – March 11h, 2019Last week’s economic news included readings on new home sales, construction spending, and housing starts. Data on building permits was released along with Labor Department reports on public and private-sector jobs and the national unemployment rate. Weekly readings on mortgage rates and new jobless claims were also released.

Construction Spending Slows as New Home Sales Rise in December

Commerce Department data for December indicated less construction spending than for November. Construction spending dipped by -o.60 percent as compared to analyst expectations of a negative reading of -0.30 percent. Construction spending grew by 0.90 percent in November.

Lower cash outlays for winter months are typical; severe winter weather likely slowed construction activity more than usual. Any downturn in building activity pressures housing markets that continue to struggle with short supplies of available homes and high buyer demand.

Sales of new homes rose in December; the Commerce Department reported 621,000 sales of new homes. Analysts estimated 600,000 sales based on November’s reading of 599,000 sales of newly-built homes. December’s reading was 3.70 percent higher than In November and was 7.00 percent lower year-over-year.

Housing Starts, Building Permits Issued Rise in January

Housing starts increased in January with 1.230 million starts annually, which was an 18.60 percent increase from December’s downwardly revised reading of 1.037million starts. 1.215million starts were expected. The revision of December’s reading contributed to the jump in January housing starts. Single-family housing starts rose 25 percent at a pace of 926,000 starts reported.

Building permits rose by 1.40 percent in January to 1,345 million permits issued as compared to December’s reading of 1.326 million permits issued.

Mortgage Rates, New Jobless Claims

Freddie Mac reported higher average mortgage rates last week with rates for fixed-rate mortgages rising six basis points and the average rate for 5/1 adjustable rate mortgages rose three basis points. 30-year fixed mortgage rates averaged 4.41 percent; 15-year fixed mortgage rates averaged 3.83 percent and mortgage rates for 5/1 adjustable rate mortgages averaged 3.87 percent.

Discount points averaged 0.50 percent for 30-year fixed rate mortgages, 0.40 percent for 15-year fixed rate mortgages and 0.30 percent for 5/1 adjustable rate mortgages.

Initial jobless claims were lower last week with 223,000 claims filed; analysts expected 225,000 new claims based on the prior week’s reading of 226,000 first-time claims filed.

Labor Reports Show Slower Jobs Growth

ADP reported the lowest increase in private-sector jobs since November; February’s reading of 183,000 private sector jobs added reflected declines in jobs within the travel and retail sectors. The Commerce Department reported only 20,000 public and private-sector jobs added for February; this was the lowest reading in 17 months. Analysts cited severe winter weather and seasonal anomalies. Construction and shipping sectors were hardest hit in February.

National unemployment dropped from 4.00 percent in January to 3.80 percent in February.

Whats Ahead

This week’s scheduled economic news includes readings on retail sales, inflation and the latest reading on construction spending. Lingering effects of the government shutdown continues to impact data released from the Federal government. Weekly readings on mortgage rates and new jobless claims will also be released.

What’s Ahead For Mortgage Rates This Week – March 4th, 2019

What’s Ahead For Mortgage Rates This Week – March 4th, 2019Last week’s economic reports included readings from Case-Shiller Housing Price Indices and Commerce Department reports on housing starts and building permits issued.

Readings on pending home sales and consumer confidence were released along with weekly reports on mortgage rates and initial jobless claims.

Case-Shiller Home Price Growth Slows to Lowest Rate in Four Years

Home prices continued to grow in December but reached their slowest pace since November2014. Seasonally-adjusted annual home price growth reached 4.70 percent in December as compared to growth of 5.10percent year-over-year in November.

Analysts cited high home prices, and slim inventories of available homes, although demand for homes eased in some metro areas. Affordability and accessibility to mortgages sidelined low and moderate-income buyers; some buyers allegedly gave up on buying homes.

Building more homes is necessary for relieving the housing shortage; real estate pros, mortgage lenders and home buyers rely on home builders to provide enough housing for first-time buyers and existing homeowners to transition from renting to owning and for existing homeowners to move up to aspirational homes. 

Housing starts fell short of expectations in December with a seasonally-adjusted annual rate of 1.078 million starts. Analysts expected 1.28 million starts based on November’s reading of 1.214 million housing starts. Construction was affected by winter weather and higher costs for building materials.

Pending Home Sales Rise in January

Pending home sales increased in January; sales with signed purchase contracts rose 4.6- percent as compared to December’s negative year-over-year reading of -2.30 percent. The National Association of Realtors® said that all four U.S. regions reported higher readings for pending home sales. The Northeast reported 1.60 percent more pending sales, Midwest and Southern regions reported increases of 2.80 percent and 8.90 percent, and the Western region reported 0.30 percent more pending home sales.

Mortgage Rates, Hold Steady New Jobless Claims Rise

Freddie Mac reported no change in 30-year fixed mortgage rates, which averaged 4.35 percent. The average rate for 15-year fixed rate mortgages dropped one basis point to 3.77 percent; mortgage rates for 5/1 adjustable rate mortgages were unchanged at 3.84 percent. Discount points averaged 0.50 percent for fixed-rate mortgages and 0.30 percent for 5/1 adjustable rate mortgages.

First-time jobless claims matched expectations of 225,000 claims filed as compared to 217,000 first-time claims filed the prior week. The University of Michigan Consumer Confidence Index rose to an index reading of 131.4 and exceeded the expected reading of 124.7.

January’s reading was 121.7. Rising consumer confidence may compel would-be home buyers to enter the housing market during peak buying season in spring and summer.

Whats Ahead

This week’s scheduled economic reports include readings on January housing starts, construction spending, and new home sales. Weekly readings on mortgage rates and new jobless claims will be released along with labor-sector reports on public and private sector jobs and the national unemployment rate.

 

What’s Ahead For Mortgage Rates This Week – February 25th, 2019

What’s Ahead For Mortgage Rates This Week – February 25th, 2019Last week’s economic news included readings on homebuilder confidence in housing market conditions, minutes of January’s Federal Open Market Committee meeting, and existing home sales reported by the National Association of Realtors®. Weekly readings on mortgage rates and new jobless claims were also released.

NAHB: Home Builder Confidence Rises to 4-Month High

Homebuilder confidence rose for the second consecutive month in February and four points higher to an index reading of 62, which exceeded analyst expectations of a one-point increase in builder confidence.

Components of the NAHB Housing Market Index also rose. Builder confidence in current market conditions rose three points to 67; builder confidence in market conditions over the next six months rose five points to 68 and builder confidence rose four points to an index reading of 48. Index readings over 50 are considered positive, but readings for buyer traffic are typically lower than the benchmark of 50.

Real estate and mortgage lending pros consider the Housing Market Index and its component readings as an indication of future home building pace. During times with few available homes and high buyer demand, industry leaders rely on builders to provide more homes.

Fed Holds Off on Raising Key Interest Rate

Minutes of the Fed’s January meeting of its Federal Open Market Committee indicated a divide in members’ positions regarding raising or holding the current federal funds rate steady. The current rate of 2.25 to 2.50 percent was unchanged as Committee members considered global economic uncertainty and domestic concerns including trade policies. On a positive note, the Fed lowered its expected reading for long-term national unemployment from 4.50 percent to 4.40 percent. Strong labor markets encourage would-be home buyers to consider buying homes.

Sales of Pre-owned Homes Fall to Three-Year Low

The National Association of Realtors® reported the lowest level of previously-owned home sales in three years. Sales were 1.20 percent lower than their three-year low in December and were 8.50 percent lower year-over-year. 4,94 million pre-owned homes were sold on a seasonally-adjusted annual basis; analysts expected 4,99 million sales and 5.00 million pre-owned homes were sold in December.

The national median home price was $247,500 in January, which was 2.80 percent higher year-over-year; this was the slowest rate of home price growth since 2012.

Home prices may have peaked in high-demand metro areas where prices are unaffordable for most residents. First-time home buyers lost market share in January and comprised 29 percent of all sales as compared to a long-term market share of 40 percent. Concerns over affordability, supplies of homes for sale and potential increases in mortgage rates sidelined first-time and moderate-income home buyers.

Mortgage Rates, New Jobless Claims Lower

Freddie Mac reported lower mortgage rates last week; rates for a 30-year fixed rate mortgage fell two basis points to 4.35 percent. Rates for a 15-year fixed-rate mortgage averaged three basis points lower at 3.78 percent.

Rates for a 5/1 adjustable-rate mortgage averaged four basis points lower at 3.84 percent. Discount points averaged 0.50 percent for 30-year fixed rate mortgages, 0.40 percent for 15-year fixed rate mortgages, and 0.30 percent for 5/1 adjustable rate mortgages.

First-time jobless claims were lower last week with 216,000 claims filed as compared to expectations of 229,000 new claims filed and the previous week’s reading of 239,000 first-time claims filed.

Whats Ahead

This week’s scheduled economic reports include Case-Shiller Home Price Indices, new home sales, and Commerce Department readings on housing starts and building permits issued. Data on consumer confidence is expected along with weekly readings on mortgage rates and new jobless claims.

What’s Ahead For Mortgage Rates This Week – February 19th, 2019

What’s Ahead For Mortgage Rates This Week – February 19th, 2019Last week’s economic reports included readings on the Consumer Price Index, Core CPI, Retail Sales and Retail Sales excluding autos. The University of Michigan also released its Consumer Sentiment Index. Weekly readings for mortgage rates and first-time jobless claims were also released.

Retail Sales Slip in December, Inflation Holds Steady

December retail sales were 1.20 percent lower in December; analysts expected no growth as compared to November’s retail sales growth of 0.10 percent. Readings for retail sales excluding the automotive sector were also lower in December with a negative reading of -1.80 percent. Analysts expected a negative reading of -0.10 percent.

November’s reading of -0.20 percent. December’s reading for retail sales was the lowest since September 2009, which was a few months after the Great Recession ended.

Retail Sales excluding Autos also had a negative reading of -1.80 percent; Analysts expected a reading of -0.10 percent based on November’s reading of -0.20 percent. Retailers traditionally rely on December’s holiday season to cover sales shortfalls throughout the year, but the government shutdown and fears of economic slowing kept shoppers away in December. January’s retail sales reports were delayed by the shutdown according to MarketWatch.

January’s Consumer Price Index was unchanged from December’s reading of 0.00 percent; analysts predicted an increase of 0.10 percent, but inflation stayed flat. Lower gas prices were credited with keeping inflation low; the reading for the Core CPI was positive with a 0.20 percent increase that matched expectations and December’s reading. The Core CPI reading excludes volatile food and energy sectors and did not include lower gas prices.

Mortgage Rates, Lower; New Jobless Claims Rise

Freddie Mac reported the lowest mortgage rates in a year. Rates for a 30-year fixed rate mortgage averaged four basis points lower at 4.37 percent. Rates for 15-year fixed rate mortgages averaged 3.81 percent and were three basis points lower.

The average rate for a 5/1 adjustable rate mortgage also dropped three basis points to 3.88 percent. Discount points averaged 0.40 percent for fixed-rate mortgages and 0.30 percent for 5/1 adjustable rate mortgages.

First-time jobless claims rose to 239,000 claims as compared to expectations of 225,000 new claims and the prior week’s reading of 235,000 new claims filed.

The University of Michigan’s Consumer Sentiment Index rose in February rose to 95.5. Analysts expected a reading of 94.00; January’s index reading was 91.20. The increase in consumer sentiment could help boost the housing market as uncertain economic projections can sideline home buyers. Housing markets improved somewhat as supplies of homes rose and buyer demand eased.

Whats Ahead

This week’s scheduled economic reports include the National Association of Home Builders Housing Market Index, Minutes from the most recent meeting of the Fed’s Federal Open Market Committee and Existing Home Sales reported by the National Association of Realtors®.

Commerce Department reports on housing starts and building permits issued will be delayed according to MarketWatch.

What’s Ahead For Mortgage Rates This Week – February 11th, 2019

What’s Ahead For Mortgage Rates This Week – February 11th, 2019Last week’s economic news included Federal Reserve Chair Jerome Powell and weekly readings on mortgage rates and new jobless claims.

Fed Faced with Public Mistrust of Institutions

Federal Reserve Chair Jerome Powel said in a speech to a group of teachers that the Federal Reserve is paddling against a current of public mistrust of the institution. Mr. Powell assured his audience that the Fed was “working in a non-political way” to support the economy.

Mr. Powell said that the Fed was working to earn public trust and said that the Central Bank must be accessible to ordinary Americans and lawmakers. In support of his remarks, Chairman Powell cited three meetings he had with lawmakers and a possible meeting at the White House.

Publicity of a recent dinner with President Trump caused speculation that the Fed may be influenced by the administration. Analysts connected last Monday’s White House dinner with the Fed’s sudden reversal of its plan to raise the target range of the federal funds interest rate. Chairman Powell said that he wanted the nation’s prosperity to be widely shared; he cited “education and mobility” as key components of achieving his goal.

Mortgage Rates, New Jobless Claims

Freddie Mac reported lower mortgage rates with a decrease of five basis points across the board for the three types of mortgages it tracks. Rates for 30-year fixed rate mortgages averaged 4.41 percent, rates for 15-year fixed rate mortgages averaged 3.84 percent.

Rates for 5/1 adjustable rate mortgages averaged 3.91 percent. Last week’s mortgage rates were approximately the same as for a year ago, but analysts said that less buyer competition and more available homes this year would encourage would-be homebuyers into the market.

First-time jobless claims were lower than the prior week at 234,000 new claims filed but were higher than the expected reading of 225,000 new claims filed, which was based on the prior week’s reading of 253,000 new claims filed. The reading for the four-week rolling average of new jobless claims gained 4,500 claims for a reading of 224,750 new claims filed over the most recent four weeks. Analysts said that although the four-week average was higher, it remained near historic lows.

Whats Ahead

This week’s scheduled economic news includes readings on inflation, retail sales and consumer sentiment. Weekly readings on mortgage rates and new jobless claims are also scheduled.