07
Nov
By First Rate Financial Group
Financial Reports

What’s Ahead For Mortgage Rates This Week – November 7, 2022

Last week’s economic reporting included the Federal Reserve’s statement on its target interest rate range and Fed Chair Jerome Powell’s regularly-scheduled press conference. Data on construction spending and public and private-sector jobs was published along with weekly reports on mortgage rates and jobless claims.Last week’s economic reporting included the Federal Reserve’s statement on its target interest rate range and Fed Chair Jerome Powell’s regularly-scheduled press conference. Data on construction spending and public and private-sector jobs was published along with weekly reports on mortgage rates and jobless claims.

Fed Hikes Key Interest Rate Range, but Signals a Future Slowdown

The Federal Reserve increased its key interest rate range last week from 3.50-3.75 percent to 3.75-4.00 percent. While this was the highest interest rate range in 15 years, the Fed said it plans to continue raising the target interest rate range until it reduces the inflation rate to 2 percent “over time.” Analysts viewed the Fed’s latest comments as less aggressive than its stance earlier this year.

Fed chair Jerome Powell said during his scheduled press conference that at some time “it will be appropriate to slow the pace of increases.” Mr. Powell also cautioned that the target interest rate range will likely rise past the current expected rate range of 4.50 to 4.75 percent.

Mortgage Rates Fall, Jobless Claims Mixed

Average mortgage rates fell last week as the rate for 30-year fixed-rate mortgages fell by 13 basis points to 6.95 percent. Rates for 15-year fixed-rate mortgages averaged 6.29 percent and 7 basis points lower than in the previous week. Rates for 5/1 adjustable rate mortgages averaged one basis point lower at 5.95 percent; Discount points averaged 0.80 percent for 30-year fixed-rate mortgages and 1.20 percent for 15-year fixed-rate mortgages. Points for 5/1 adjustable rate mortgages averaged 0.20 percent.

 

Initial jobless claims fell by 217,000 claims as compared to the previous week’s reading of 218,000 new claims filed. Continuing jobless claims increased to 1.49 million claims filed from the previous week’s reading of 1.44 million ongoing claims filed.

Job Growth Data Mixed, Unemployment Rate Rises

ADP reported 239,000 private-sector jobs added in October as compared to expectations of 195,000 jobs added and September’s reading of 192,000 private-sector jobs added. The Commerce Department’s Non-Farm Payrolls reported 261,000 public and private-sector jobs added in October as compared to expectations of 205,000 jobs added and 315,000 jobs added in September. The national unemployment rate rose to 3.7 percent in October from September’s rate of 3.5 percent.

In other news, construction spending rose 0.2 percent in September; analysts expected spending to drop -0.6 percent based on August’s construction spending pace of -0.7 percent

What’s Ahead

 

This week’s scheduled economic reporting includes readings on inflation and consumer sentiment. Weekly readings on mortgage rates and jobless claims will also be published.

Last week’s economic reporting included the Federal Reserve’s statement on its target interest rate range and Fed Chair Jerome Powell’s regularly-scheduled press conference. Data on construction spending and public and private-sector jobs was published along with weekly reports on mortgage rates and jobless claims.
Fed Hikes Key Interest Rate Range, but Signals a Future Slowdown
The Federal Reserve increased its key interest rate range last week from 3.50-3.75 percent to 3.75-4.00 percent. While this was the highest interest rate range in 15 years, the Fed said it plans to continue raising the target interest rate range until it reduces the inflation rate to 2 percent “over time.” Analysts viewed the Fed’s latest comments as less aggressive than its stance earlier this year. 
Fed chair Jerome Powell said during his scheduled press conference that at some time “it will be appropriate to slow the pace of increases.” Mr. Powell also cautioned that the target interest rate range will likely rise past the current expected rate range of 4.50 to 4.75 percent. 
Mortgage Rates Fall, Jobless Claims Mixed
Average mortgage rates fell last week as the rate for 30-year fixed-rate mortgages fell by 13 basis points to 6.95 percent. Rates for 15-year fixed-rate mortgages averaged 6.29 percent and 7 basis points lower than in the previous week. Rates for 5/1 adjustable rate mortgages averaged one basis point lower at 5.95 percent; Discount points averaged 0.80 percent for 30-year fixed-rate mortgages and 1.20 percent for 15-year fixed-rate mortgages. Points for 5/1 adjustable rate mortgages averaged 0.20 percent.
Initial jobless claims fell by 217,000 claims as compared to the previous week’s reading of 218,000 new claims filed. Continuing jobless claims increased to 1.49 million claims filed from the previous week’s reading of 1.44 million ongoing claims filed.
Job Growth Data Mixed, Unemployment Rate Rises
ADP reported 239,000 private-sector jobs added in October as compared to expectations of 195,000 jobs added and September’s reading of 192,000 private-sector jobs added. The Commerce Department’s Non-Farm Payrolls reported 261,000 public and private-sector jobs added in October as compared to expectations of 205,000 jobs added and 315,000 jobs added in September. The national unemployment rate rose to 3.7 percent in October from September’s rate of 3.5 percent. 
In other news, construction spending rose 0.2 percent in September; analysts expected spending to drop -0.6 percent based on August’s construction spending pace of -0.7 percent
What’s Ahead
This week’s scheduled economic reporting includes readings on inflation and consumer sentiment. Weekly readings on mortgage rates and jobless claims will also be published.

28
Oct
By First Rate Financial Group
Financial Reports

S&P Case-Shiller Home Price Indices: U.S. Home Price Growth Slows in August

S&P Case-Shiller Home Price Indices: U.S. Home Price Growth Slows in AugustU.S home price growth slowed for the second consecutive month in August according to S&P Case-Shiller’s national home price index. National home price growth fell by -9.8 percent year-over-year as compared to July’s year-over-year reading of  -5.3 percent. Home price growth slowed by -1.1 percent month-to-month from July to August.

Rising Mortgage Rates and Recession Worries Dampen Homebuyer Interest

The Mortgage Bankers Association forecasted a recession in 2023 and expects mortgage rates to fall to approximately 5.40 percent by the end of 2023. Mike Fratantini, senior vice president and chief economist at the MBA, said: “The upside of [a potential recession] for the industry is that it’s likely going to bring rates down a little bit.” Current rates for 30-year fixed-rate mortgages are near seven percent; the MBA expects 30-year fixed mortgage rates to fall to approximately 5.40 percent by the end of 2023.

Rising mortgage rates coupled with high home prices created affordability concerns and challenged would-be buyers in meeting mortgage approval requirements. Less demand for homes caused home price growth to slow nationwide.

S&P Case-Shiller 20-City Home Price Index: August Home Price Growth Slows in All Cities

Home price growth peaked in April with a  national home price growth rate of 21.2 percent year-over-year, but slowed to a pace of 16.0 percent in July and 13.1 percent in August. The top three cities in the 20-City Index were Miami, Florida with 28.6 percent home price growth. Home prices rose by 28.0 percent in Tampa, Florida, and were 21.3 percent higher in Charlotte, North Carolina.

In related news, the Federal Housing Finance Agency released its House Price Index for August. Home prices for homes owned or financed by Fannie Mae and Freddie Mac fell by -0.7 percent in August. This was the first time since March 2011 that the FHFA HPI decreased for two consecutive months.

Inventories of newly-built homes were higher than normal at a 9.2 months supply. Real estate pros typically consider a  six- months supply of homes for sale reflective of a balanced housing market.  Rising materials costs caused home builders to raise home prices; the median home price of a new home in August was $470,600 and 13.90 percent higher year-over-year, but some builders are reducing prices and offering buyer incentives on new homes as sales falter. 

24
Oct
By First Rate Financial Group
Financial Reports

What’s Ahead For Mortgage Rates This Week – October 24, 2022

What's Ahead For Mortgage Rates This Week - October 24, 2022Last week’s economic reporting included readings from the National Association of Home Builders on national and regional  U.S. housing markets. The National Association of Realtors® reported on sales of previously-owned homes, and the Commerce Department released readings on building permits issued and housing starts. Weekly readings on mortgage rates and jobless claims were also released.

NAHB: Home Builder Confidence in Housing Market Falls for 10th Consecutive Month

The National Association of Home Builders reported that home builder confidence in the U.S housing market fell for the 8th consecutive month in October; the organization described the situation as “unsustainable.” The NAHB Housing Market Index, which is based on index readings from 1 to 100, fell to an index reading of 38 in October as compared to the expected reading of 44 and September’s reading of 46. NAHB index readings below 50 indicate that most builders are less confident about housing market conditions than are positive about the U.S  single-family housing market.

NAHB’s regional U.S housing market readings were mixed with the Northeast region reporting a one-point increase in homebuilder confidence in housing market conditions from an index reading of  47 to 48. Home builder confidence in the Midwest fell to a reading of 38 in October from September’s index reading of 42. Homebuilder confidence in housing markets in the South fell by 11 points to an index reading of 41 in October. Homebuilder confidence in housing market conditions lagged in the West from September’s reading of 34 to October’s index reading of 25. Rising mortgage rates and high home prices combined to quash homebuilder enthusiasm.

Existing Home Sales Fall in September

The National Association of Realtors® reported slower sales of previously-owned homes in September as compared to August. 4.71 million sales were reported in September on a seasonally-adjusted annual basis. Previously-owned homes sold at a seasonally-adjusted annual pace of 4.78 million sales in August. 

The Commerce Department reported that 1.56 million building permits were issued on a seasonally-adjusted annual basis in September Analysts expected a reading of 1.54 million permits issued, which was unchanged from August’s reading. In related news, 1.44 million housing starts were reported on a seasonally-adjusted annual basis in September. Analysts expected a seasonally-adjusted annual pace of 1.47 million housing starts based on August’s seasonally-adjusted annual reading of 1.57 million housing starts.

Mortgage Rates Rise, Jobless Claims

Freddie Mac reported higher average mortgage rates last week, but they rose at a slower pace than in recent weeks. Rates for 30-year fixed-rate mortgages averaged 6.94 percent and were two basis points higher than in the previous week. Rates for 15-year fixed-rate mortgages averaged 6.23 percent and were 14 basis points higher. The average rate for 5/1 adjustable rate mortgages fell by 10 basis points to 5.71 percent. Discount points averaged 0.90 percent for 30-year fixed-rate mortgages and 1.10 percent for 15-year fixed-rate mortgages. Discount points for 5/1 adjustable rate mortgages averaged 0.40 percent.

Initial jobless claims fell last week with 214,000 new claims filed as compared to 226,000 first-time claims filed in the previous week. Analysts expected 230,000 new jobless claims to be filed. 1.39 million ongoing jobless claims were filed last week as compared to 1.36 million continuing claims filed in the previous week.

What’s Ahead

This week’s scheduled economic reporting includes readings on U.S home prices, new and pending home sales, and inflation. The University of Michigan will issue its monthly reading on consumer sentiment and weekly readings on mortgage rates and jobless claims will also be released.