25
Jan
By First Rate Financial Group
Financial Reports

What’s Ahead For Mortgage Rates This Week – January 25, 2021

What's Ahead For Mortgage Rates This Week - January 25, 2021Last week’s economic reporting included readings from the National Association of Home Builders Housing Market Index, along with Commerce Department readings on housing starts and building permits issued. The National Association of Realtors® reported on sales of previously-owned homes; weekly readings on mortgage rates and jobless claims were also released.

NAHB: Home Builders’ Housing Market Index Falls in January

Homebuilder confidence in housing market conditions fell three points to an index reading of 83 in January. The National Association of Home Builders Housing Market Index expected a reading of 85 for January as compared to December’s index reading of 86. Increasing covid-19 cases and rising materials costs caused builder confidence to fall as builder concerns rose.

The NAHB Housing Market Index remained strong as any reading over 50 indicates positive builder sentiment toward housing markets. Component readings for January’s Housing Market Index also fell; builder confidence in current market conditions fell two points to an index reading of 90. Homebuilder confidence in market conditions for the next six months also fell two points to 83. Builder confidence in buyer traffic in new housing developments dropped five points to an index reading of 68. Readings of more than 50 for buyer traffic were rare until the covid-19 pandemic started.

Conflicting factors impacted home builder confidence readings. Home sales rose as urban homeowners sought new and larger homes in the suburbs and rural areas, labor shortages, and rising materials expenses worried home builders.

Housing Starts and Building Permits Rose in December

The Commerce Department reported a seasonally-adjusted annual pace of 1.67 million housing starts as compared to November’s reading of 1.547 million starts. Building permits issued rose in December with 1.709 million permits issued annually as compared to November’s reading of 1.635 million housing starts.

The National Association of Realtors® reported 6.76 million sales of previously-owned homes sold as of December on a seasonally-adjusted annual basis. Home sales are increasing although demand exceeds available inventory and home prices continue to rise.

Mortgage Rates, Jobless Claims Lower

Mortgage rates fell last week with the average rate for 30-year fixed-rate mortgages two basis points lower on average at 2.77 percent. Rates for 15-year fixed-rate mortgages averaged 2.21 percent and were two basis points lower. Rates for 5/1 adjustable rate mortgages averaged 2.80 percent and 32 basis points lower. 

First-time jobless claims fell to 900,000 claims filed as compared to the prior week’s reading of 926,000 new claims filed. Ongoing jobless claims were also lower last week with 5.05 million continued claims filed as compared to 5.18 million claims filed the previous week. 

What’s Ahead

This week’s scheduled economic reporting includes readings from Case-Shiller Home Price Indices, the FHFA House Price Index, and the Federal Reserve’s Statement from its Federal Open Market Committee. Monthly readings on new home sales and consumer sentiment will also be published. Weekly readings on mortgage rates and jobless claims will also be released.

19
Jan
By First Rate Financial Group
Financial Reports

What’s Ahead For Mortgage Rates This Week – January 19, 2021

What's Ahead For Mortgage Rates This Week - January 19, 2021Last week’s economic reports included readings on inflation, retail sales, and a speech by Federal Reserve Chair Jerome Powell. Weekly readings on mortgage rates and jobless claims were also released.

 Inflation Rises as Retail Sales Fall, Fed  Says Current Monetary Policy Won’t Change

The Consumer Price Index rose to 0.40 percent in December as compared to November’s reading of 0.20 percent. The CPI measures inflation and the Core CPI measures inflation without the volatile sectors of food and fuel. December’s Core CPI reading fell to a rate of 0.10 percent growth from November’s reading of 0.20 percent.

Retail sales were dampened by the coronavirus, but December’s negative reading of -0.70 percent sales was lower than the    -1.40  percent rate reported in November.  December sales excluding the automotive sector were -1.40 percent lower in December as compared to November’s reading of -1.30 percent.

Federal Reserve Chair Jerome Powell dispelled fears of rising inflation and said that the Fed’s Federal Open Market Committee will not raise its current federal interest rate range of 0.00 to 0.25 percent any time soon. Chair Powell also said that the Fed would not decrease its purchase of Treasury Bonds as a further measure to stabilize the economy.

Mortgage Rates, Jobless Claims Rise

Freddie Mac reported higher average mortgage rates last week. Rates for 30-year fixed-rate mortgages rose by 14 basis points to 2.79 percent. Rates for 15-year fixed-rate mortgages averaged 2.23 percent and were seven basis points higher. Rates for 5/1 adjustable rate mortgages rose by 37 basis points to 3.12 percent on average. Discount points averaged 0.70 percent for fixed-rate mortgages and 0.40 percent for  5/1 adjustable rate mortgages.

First-time jobless claims rose to 965,000 claims filed last week as compared to the prior week’s reading of 784,000 initial claims filed. Ongoing jobless claims also rose with 5.27 million claims filed as compared to the prior week’s reading of  5.07 million continuing claims filed.

The University of Michigan’s Consumer Sentiment Index was lower in January with a reading of 79.2.  Analysts expected an index reading of 79.2 based on the December reading of 80.7.

What’s Ahead

This week’s scheduled economic reports include the National Association of Home Builder’s Housing Market Index and reports from the Commerce Department on housing starts, building permits issued. Sales of pre-owned homes will also be reported along with weekly readings on mortgage rates and jobless claims.

11
Jan
By First Rate Financial Group
Financial Reports

What’s Ahead For Mortgage Rates This Week – January 11, 2021

What's Ahead For Mortgage Rates This Week - January 11, 2021Last week’s economic reports included readings on construction spending and reports on the national unemployment rate and job growth. Weekly reporting on mortgage rates and jobless claims were also published.

Construction Spending Increases as Demand for Homes Rises

Homebuilders responded to increased demand for single-family homes and increased their spending in November. Construction spending rose by 0.90 percent as compared to projected spending of 1.10 percent and  1.60 percent growth in November. Demand for homes increased in recent months due to the coronavirus pandemic. Homeowners left urban areas and bought larger homes in suburban and rural areas. Low mortgage rates, flight from cities, and needs related to working from home and homeschooling fueled demand for single-family homes.

Construction spending tapered off in November due to seasonal slowdowns and winter weather but is expected to continue growing as record-low mortgage rates encouraged prospective and current homeowners to seek larger homes.

Mortgage Rates Mixed, Jobless Claims Fall

Freddie Mac reported lower rates for fixed-rate mortgages as the average rate for 5/1 adjustable rate mortgages rose. Rates for 30-year fixed-rate rate mortgages fell by two basis points to 2.65 percent. The average rate for 15-year fixed-rate mortgages dropped by one basis point to 2.16 percent. Rates for 5/1 adjustable rate mortgages averaged 2.75 percent and were four basis points higher. Discount points averaged 0.70 percent for 30-year fixed- rate mortgages and 0.60 percent for 15-year fixed-rate mortgages. Discount points averaged 0.30 percent for 5/1 adjustable rate mortgages.

Jobless claims fell last week with 787,000 first-time claims filed as compared to 790,000 new claims filed in the prior week. Analysts expected 815,000 initial claim filings. Ongoing jobless claims were also lower with 5.07 million claims filed as compared to the prior week’s reading of 5.20 million continuing jobless claims filed.

Jobs Growth Falls in December; National unemployment Rate Holds Steady

ADP reported 123,000 fewer private-sector jobs n December as compared to 804,000 private-sector jobs added in November. The federal government’s Non-Farm Payrolls report showed similar results for December’s reading on public and private-sector jobs. 140,000 fewer jobs were reported in December as compared to 336,000  public and private-sector jobs added in November. December’s national unemployment rate was unchanged at 6.70 percent. 

What’s Ahead

 This week’s scheduled economic reports include readings on inflation, retail sales, and consumer sentiment. Weekly readings on mortgage rates and jobless claims will also be reported.