31
Dec
By First Rate Financial Group
Financial Reports

What’s Ahead For Mortgage Rates This Week – December 31st, 2018

What’s Ahead For Mortgage Rates This Week – December 31st, 2018Last week’s economic reports included readings from Case-Shiller Housing Market Indices, National Association of Realtors® on pending home sales and weekly readings on mortgage rates and new jobless claims.  

The Commerce Department’s reading on sales of new homes was delayed due to the federal government’s shutdown.

Case-Shiller: Home Price Growth Lowest in Two Years

Home price growth was nearly nil with October’s month-to-month reading of 0.40 percent; The Case-Shiller 20-City Home Price Index showed a year-over-year home price growth rate of 5.50 percent, which matched September’s year-over-year reading. Las Vegas, Nevada led home price growth in the 20-city index with a year-over-year increase of 12,80 percent; San Francisco, California had home price growth of 7,90 percent and Phoenix, Arizona home prices grew by 7.70 percent year-over-year in October.

While San Francisco, California, Seattle, Washington and Portland, Oregon dominated the top three spots in the 20-City Home Price Index in recent years, the latest home price growth rates indicate that the West Coast may be easing off on its rapid home price gains. High-cost metro areas risk reaching a tipping point when there are few properties available with very high prices and buyers competing.

,Affordability and slim choice of available homes can cause would-be buyers to sideline themselves while they await more options and lower prices. Rising mortgage rates caused concern among buyers concerned with affordability and qualifying for mortgage loans under strict lender requirements.

Pending Home Sales Improve, But Remain in Negative Territory

Future home sales slipped in November, but less so than they did in October. Pending sales registered in negative territory with a reading of -0.70 percent in November as compared to October’s reading of -2.60 percent.

Analysts and real estate pros view pending sales as an indication of future completed sales and mortgage activity; falling numbers for pending home sales suggest slowing home sales that could impact housing markets. Pending sales are considered sales for which purchase contracts have been signed, but that have not closed.

Mortgage Rates, New Jobless Claims

Freddie Mac reported lower averaged fixed mortgage rates with the rate for a 30-year fixed rate mortgage lower by seven basis points at 4.55 percent. The average rate for a 15-year fixed rate mortgage fell by six basis points to 4.01 percent and the average rate for a 5/1 adjustable rate mortgage rose two basis points to 4.00 percent. Falling mortgage rates could induce discouraged home buyers to look for homes again.

First-time jobless claims dropped by 1000 claims to 216,000 new claims filed. Analysts predicted a reading of 217,000 mew claims filed, which was unchanged from the prior week’s reading.

What‘s Ahead

This week’s scheduled economic reports include readings on construction spending, non-farm payrolls and the national unemployment rate. Weekly reports on mortgage rates and first-time unemployment claims are also scheduled. Please note that some scheduled readings could be delayed due to the federal government shut-down.

24
Dec
By First Rate Financial Group
Financial Reports

What’s Ahead For Mortgage Rates This Week – December 24th, 2018

What’s Ahead For Mortgage Rates This Week – December 24th, 2018Last week’s economic news included readings from the National Association of Home Builders, Commerce Department readings on housing starts and National Association of Realtors® report on sales of previously-owned homes. Weekly reports on mortgage rates and first-time jobless claims were also released.

NAHB: Home Builders Lose Confidence as Housing Crunch Continues

Homebuilder confidence fell to a 36 month low in December as homebuilder concerns over rising home prices, high mortgage rates and decreasing inventories of available homes sidelined home buyers. The NAHB Housing Market Index fell four points to 56.

Components of the Housing Market Index reading also fell as builder confidence in current market conditions fell six points to an index reading of 61; builder confidence in new home sales over the next six months fell by four points to a reading of 61. Builder confidence in buyer traffic in new home developments dipped two points to 43.

While any reading over 50 is considered positive, buyer traffic readings under 50 are not unusual.

Analysts and real estate pros often consider the Home Builders Housing Market Index as an indicator of future new home construction and sales. Rising home prices and mortgage rates were cited as reasons contributing to the drop in home builder confidence.

Existing Home Sales, Housing Starts and Building Permits Issued Rise in November

Sales of pre-owned homes rose in November with 5.32 million sales reported on an annual seasonally adjusted basis. Analysts expected a reading of 5.17 million sales based on October’s sales pace of 5.22 million sales.

Three out of four regions reported gains in sales of pre-owned homes. The Northeast reported a gain of 7.20 percent; the Midwest reported a year-over-year gain of 5.50 percent and sales of pre-owned homes were 2.50 percent higher in the South. The West lost traction in existing home sales with a negative reading of -6.30 percent. Known for high home prices, it may be that home prices have peaked in the West.

The Commerce Department reported housing starts at the rate of 1.25 million in November; analysts predicted a rate of 1.230 million starts based on October’s reading of 1.217 million starts. November building permits rose to 1.328 million permits issued as compared to a reading of 1.265 million permits issued in October.

Analysts said that more apartment homes were being built; this trend could be a further indication of home prices being out of reach for would-be home buyers.

Mortgage Rates, New Jobless Claims Dip

Freddie Mac reported lower mortgage rates last week; 30-year fixed mortgage rates averaged 4.62 percent and were one basis point lower than in the prior week.  15-year fixed mortgage rates were unchanged at an average of 4.07 percent.

The average rate for 5/1 adjustable rate mortgages was six basis points lower at 3.98 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 fell last week to 206,000 claims filed. Analysts predicted 218,000 new jobless claims based on the prior week’s reading of 206,000 new unemployment claims filed.

What‘s Ahead

This week’s scheduled economic readings include Case-Shiller Home Price Indices, new and pending home sales and weekly readings on mortgage rates and new jobless claims. Government shutdown may impact some readings.

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.