What's Ahead For Mortgage Rates This Week - June 18th, 2018

Last week's economic reports included the post-meeting statement by the Fed's Federal Open Market Committee along with readings on retail sales and inflation. Weekly reports on mortgage rates and new jobless claims were also released.

Fed Raises Key Interest Rate on Strong Economic Indicators

The post-meeting announcement by the Federal Open Market Committee of the Federal Reserve indicated that committee members voted to raise the target federal funds rate to 0.175 to 2.00 percent from the prior rate of 1.50 to 1.75 percent.

The post-meeting announcement cited strong economic conditions and stated that FOMC had altered their outlook from three rate increases in 2018 to four increases. This news is significant to consumers as banks and credit card companies typically raise lending rates in response to Federal Reserve actions.

Committee members were closely divided on interest rate forecasts for 2018. Eight members said that the Fed rate would likely increase four times in 2018 while seven members said three rate increases would be appropriate. The post-meeting statement also cited concerns over inflation and Fed Chair Jerome Powell said that raising interest rates too fast could increase the risk of recession.

Consumer Price Index, Retail Sales Rise in May

The Consumer Price Index rose from 0.10 percent in April to 0.20 percent in May according to the Commerce Department. The Core CPI, which excludes volatile food and fuel sectors, was unchanged at 0.20 percent against expectations of 0.20 percent growth and 0.20 percent in April.

Retail sales rose 0.80 percent in May as compared to expectations of 0.40 percent growth and April's growth rate of 0.40 percent. Retail sales excluding the automotive sector rose 0.90 percent in May; analysts expected a reading of 0.50 percent based on April's reading of 0.40 percent growth.

Mortgage Rates Rise, New Jobless claims Fall

Freddie Mac reported higher mortgage rates last week. The average rate for a 30-year fixed rate mortgage averaged eight basis points higher at 4.60 percent; the average rate for a 15-year fixed rate mortgage rose six basis points to 4.07 percent.

Rates for a 5/1 adjustable rate mortgage were nine basis points higher at 3.83 percent on average. Freddie Mac analysts said that demand for homes is holding steady despite higher mortgage rates.

First-time jobless claims fell by 4,000 new claims to 218,000 new claims filed. Analysts expected 225,000 new claims to be filed based on the prior week's reading of 222,000 new jobless claims filed.

What's Ahead

This week's scheduled economic reports include NAHB Housing Market Indices, Commerce Department readings on housing starts and building permits issued and National Association of Realtors® reports on sales of previously-owned homes. Weekly readings on mortgage rates and new jobless claims will also be released.

What's Ahead For Mortgage Rates This Week - June 11th, 2018

Last week’s economic reports included analyst assertions that U.S. housing markets are overvalued in over 50 percent of markets. Weekly reports on mortgage rates and first-time jobless claims were also released.

CoreLogic: Over Half of Top 50 U.S. Housing Markets Overvalued

Rapidly rising home prices are causing some U.S. markets to be overvalued, which means that home prices are higher than a community’s ability to sustain. What goes up must come down in such scenarios, but home prices continue to grow in many areas.

While Boston, Massachusetts and San Francisco, California continued to see rapidly rising home prices, analysts said that residents of the two cities had incomes sufficient to meet the cost of homes. Examples of cities where home prices were overvalued in April included os Angeles, California, Denver, Colorado and Washington, D.C. Supplies of available homes have fallen over the last three years.  Real estate pros and analysts continue to cite building more homes is the only solution to the shortage.

The National Association of Realtors® said that although supplies of new homes have increased in recent months, most newly built homes are priced for move-up buyers. Moderate-income and first-time buyers haven’t seen much improvement in available affordable homes. Rising mortgage rates in recent months also presented an obstacle to finding affordable homes.

Mortgage Rates, New Jobless Claims Fall

Freddie Mac reported lower average mortgage rates last week. Rates for a 30-year fixed rate mortgage fell two basis points to 4.54 percent; rates for a 15-year fixed rate mortgage were five basis points lower at an average rate of 4.01 percent. Rates for a 5/1 adjustable rate mortgage averaged 3.74 percent and were six basis points lower. Discount points for 30-year fixed rate mortgages averaged 0.50 percent; discount points for 15-year fixed rate mortgages and 5/1 adjustable rate mortgages averaged 0.40 percent.

First-time jobless claims fell last week despite predictions that they would rise. 222,000 new claims were filed as compared to expectations of 225,000 new claims and the prior week’s reading of 223,000 new claims.

What’s Ahead

This week’s scheduled economic releases include the post-meeting statement from the Federal Reserve’s Federal Open Market Committee, readings on consumer prices and retail sales. Mortgage rates and new jobless claims will also be released.

What's Ahead For Mortgage Rates This Week - June 4th, 2018

Last week's economic reports included readings on Case-Shiller home prices, pending home sales and construction spending. Weekly readings on mortgage rates and new jobless claims were released, along with monthly labor-related reports on job creation and the national unemployment rate.

Case-Shiller: Home Prices Maintain Rapid Growth

S&P Case-Shiller home price indices for March showed home prices continued to grow at blazing rates. Seattle, Washington held on to first place with a seasonally-adjusted annual rate of 13.00 percent; Las Vegas, Nevada reported 12.40 percent growth in home prices in March.

Analysts said Las Vegas markets benefitted from homebuyers relocating from high-priced coastal areas. Las Vegas home prices were 25 percent below their housing bubble peak. San Francisco reported year-over-year home price growth of 11.40 percent

Home prices were driven by short supplies of homes for sale and high demand among buyers, which led to bidding wars in high-demand areas. Rapidly rising home prices sideline first-time and moderate-income buyers who face hurdles of affordability and strict mortgage approval requirements.

While real estate pros and economic analysts expected home price growth to reach a tipping point where demand for homes would slow down, it hasn't happened yet. Strong economic conditions and jobs data provided first-time buyers incentives to transition from renting to owning.

Pending Home Sales Slow in April

Pending home sales, which are sales under contract but not yet closed, dropped by -1.30 percent in April as compared to the March reading of 0.60 percent. Severe winter weather contributed to the lag, but analysts said severe shortages if available homes squeezed would-be buyers to the sidelines as they waited for more buying options. The National Association of Realtors® said that April's reading was the third consecutive month of lower pending home sales.

Construction spending rose by 1.80 percent in April and surpassed expectations of a one percent increase and the negative March reading of -1.70 percent. This could be a hopeful sign if accelerated spending is due to growing construction projects, but ongoing concerns over increased materials and labor costs may have contributed to builders' cash outlay.

Mortgage Rates, Weekly Jobless Claims Fall

Mortgage rates eased last week, with average rates lower across the board. Freddie Mac reported the rate for a 30-year fixed rate mortgage fell by 10 basis points to 4.56 percent. The average rate for a 15-year fixed rate mortgage was nine basis points lower at 4.06 percent; rates for 5/1 adjustable rate mortgages averaged 3.80 percent and were seven basis points lower. 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 221,000 claims filed. Analysts expected 225,000 new claims filed based on the prior week's reading of 234,000 new claims filed. May payroll reports supported stronger labor markets as ADP reported 178,000 jobs added as compared to 163,000 private-sector jobs added in April. Non-farm payrolls, which measure private and public-sector job growth, rose by 223,000 jobs in May as compared to 159,000 jobs added in April. The highlight of May labor reports was an 18-year low of 3.80 percent national unemployment rate for May.

What's Ahead

This week's scheduled economic reports include readings on job openings, mortgage rates and new jobless claims.

What's Ahead For Mortgage Rates This Week - May 21st, 2018

Last week's economic releases included the National Association of Home Builders Housing Market Index for May, Commerce Department reports on housing starts and building permits issued. Weekly readings on mortgage rates and first-time jobless claims were also released

Home Builder Confidence Rises in May

According to the National Association of Home Builders, home builders surveyed indicated higher confidence in housing market conditions for May. April's reading was downwardly revised to an index reading of 68; analysts expected a reading of 69.  May's home builder confidence reading was 70. Any reading over 50 indicates that more builders consider housing market conditions to positive.

Three-month rolling readings for regions showed mixed results in May. Northeast and Western regions were unchanged with index readings of 55 and 76 respectively. Midwestern and Southern regions posted a one-point drop with respective index readings of 65 and 92. The NAHB cited high lumber prices as a concern and said that rising materials costs were impacting builders' ability to produce affordable housing for first-time buyers.

Both housing starts and building permits issued were lower in April than for March; The Commerce Department reported1.287 million housing starts in April as compared to 1.336 million starts in March. Housing starts are calculated on a seasonally-adjusted annual basis. Although housing starts were 3.70 percent lower in April, analysts said there was little concern as the rate of housing starts remained near the highest levels in 11 years.

April's decline in housing starts was attributed to volatile multi-unit projects; construction rates for single-family homes were little changed. The South reported an increase in housing starts as all other regions reported fewer housing starts. Builders said that labor shortages continue to impact construction rates. Analysts expected construction rates to expand throughout 2018 as demand for homes rises. Building permits issued fell in April to a seasonally-adjusted annual rate of 1.352 million from the March reading of 1.377 million permits issued.

Mortgage Rates, New Jobless Claims

Mortgage rates rose to their highest level in seven years. Rates for a 30-year fixed rate mortgage were six basis points higher and averaged 4.61 percent. The average rate for a 15-year fixed rate mortgage was seven basis points higher at 4.08 percent. Mortgage rates for a 5/1 adjustable rate mortgage averaged five basis points higher at 3.82 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 222,000 new claims last week as compared to 211,000 new claims filed the prior week. Analysts expected 215,000 new claims filed.

What's Ahead

This week's economic releases include readings on sales of new and previously-owned homes and consumer sentiment. Weekly readings on mortgage rates and new jobless claims will also be released.

What's Ahead For Mortgage Rates This Week - May 7th, 2018

Last week's economic releases included readings on inflation, construction spending and private and public- sector payrolls. Weekly readings on mortgage rates and first-time jobless claims were also posted.

Inflation Meets Fed Goal, Construction Spending Lower

March inflation reached a year-over-year rate of two percent, which is the Federal Reserve's goal for inflation. Inflation rose by 0.20 percent in March to 0.40 percent; analysts expected inflation to rise 0.50 percent. Core inflation, which excludes volatile food and energy sectors, met expectations with 0.20 percent growth.

Construction spending was lower in March with a negative reading of -1.70 percent. Analysts predicted an increase of 0.50 percent based on February's one percent increase in construction spending. Construction costs were five percent higher year-over-year, and builders cited long-standing concerns with lot shortages. Tariffs on building materials fueled rising materials costs. Analysts said construction spending remains strong

Mortgage Rates, Jobs Data Mixed

Freddie Mac reported lower mortgage rates last week as the average rate for a 30-year fixed rate mortgage dropped three basis points to 4.55 percent. Rates or a 15-year fixed rate mortgage were one basis point higher at 4.03 percent. Rates for a 5/1 adjustable rate mortgage averaged five basis points lower at 3.69 percent.

The Federal Reserve's Federal Open Market Committee elected not to raise the target federal funds rate from its current range of 1.50 to 1.75 percent; when fed rates are raised, private lenders including mortgage banks typically raise home loan rates.

New jobless claims were lower last week with 211,000 new claims filed. Analysts expected 225,000 new claims based on the prior week's reading of 209,000 new jobless claims.

ADP Payrolls reported 204,000 private-sector jobs added in April as compared to the March reading of 228,000 jobs added. The Commerce Department reported 164,000 public and private sector jobs added in April, which was lower than expectations of 184,000 jobs added. The national unemployment rate for April dipped to 3.90 percent as compared to expectations of 4.0 percent and March's reading of 4.10 percent.

What's Ahead

This week's economic readings include job openings, mortgage rates and new jobless claims. The University of Michigan will also release its monthly Consumer Sentiment Index.

What's Ahead For Mortgage Rates This Week - April 30th, 2018

Last week’s economic reports included readings from Case-Shiller Home Price Indices, new and existing home sales and weekly readings on mortgage rates and first-time jobless claims.

Case-Shiller: Home Prices Rise to Near Four-Year High

February home prices rose 6.30 percent year-over-year and 0.50 percent month-to-month. Home prices rose just shy of a record set in 2014. The 20-City Home Price Index reported home prices were 6.80 percent higher year-over-year and rose 0.80 percent month-to-month in February. The year-over-year reading surpassed the peak reading in 2006. Home prices accelerated in contrast to analyst expectations that they nay slow as buyers deal with a short supply of homes for sale.

Cities with the three highest readings in year-over-year home price growth were Seattle, Washington with 12.70 percent growth, Las Vegas, Nevada home prices rose 11.60 percent, and San Francisco, California home prices rose by 10.10 percent according to Case-Shiller’s 20-City Home Price Index for February.

Severe shortages of homes and high demand in the west and in areas impacted by the housing bubble burst are driving the rapid rise of home prices; while it appears that homebuyers may be sidelined by high home prices, increasing home sales suggest that buyers may be buying before higher prices cut them out of the market.

Sales of New and Existing Homes Surpass Expectations in March

Sales of pre-owned homes rose to 5.60 million sales on a seasonally-adjusted year-over-year basis. Analysts expected a reading of 5.52 million sales based on February’s reading of5.54 million pre-owned homes sold. Sales of new homes also exceeded expectations with a sales rate 0f 694,000 sales on a seasonally-adjusted annual basis. Analysts expected a reading of 634,000 new hone sales. February’s reading was 667,000 new home sales. As with the boost in sales of pre-owned homes, analysts said that buyers are anxious to buy before they’re priced out of the market or cannot qualify for mortgage loans.

Mortgage Rates Rise, New Jobless Claims Fall
Freddie Mac reported higher average mortgage rates for the third consecutive week. Rates for a 30-year fixed rate mortgage averaged 4.58 percent and were 11 basis points higher. The average rate for a 15-year fixed rate mortgage was 8 basis points higher at 4.02 percent; The average rate for a 5/1 adjustable rate mortgage was seven basis points higher at 3.74 percent. Rising Treasury yields were driven by higher commodity prices drove mortgage rates higher.

Economic indicators have steadily strengthened, which traditionally boosts home prices. While analysts have shown concerns over rapidly rising home prices and mortgage rates, the Mortgage Bankers Association reported mortgage applications were 11 percent higher year-over-year.

New jobless claims fell to 209,000 first-time claims filed as compared to expectations of 230,000 new claims, and the prior week’s reading of 233,000 new claims filed. Lower jobless claims indicate fewer layoffs and strengthening labor markets.

What’s Ahead
This week’s economic releases include readings on inflation, job growth, and national unemployment. Weekly readings on mortgage rates and new jobless claims will also be released.

What's Ahead For Mortgage Rates This Week - April 23rd, 2018

Last week's economic reports included readings on builder confidence, housing starts and building permits issued. Weekly readings on mortgage rates and new jobless claims were also released.

NAHB: Builder Confidence Drops by One Point

The National Association of Home Builders reported that builder confidence dipped by one point in April to an index reading of 69. While any reading over 50 indicates positive builder sentiment, NAHB noted that builder sentiment has decreased for the past four months.

During the housing bubble of 2004 and 2005, builder confidence in market conditions averaged 68, but analysts said that the post bubble crash in home values was preceded by several months of decreasing builder sentiment.

Builders are maintaining a steady approach to housing starts despite high demand in many markets. Short supplies of available homes are driving prices higher and causing issues of affordability for would be buyers. Home builders continued to face shortages of buildable lots and rising materials prices. This could account for decisions not to ramp up home construction enough to meet demand.

Housing Starts, Building Permits Rise

According to the Commerce Department, housing starts and building permits issued rose in March. 1.319 million starts were reported on a seasonally-adjusted annual basis as compared to 1.1,295 million starts in February. Analysts expected housing starts to drop in March to 1.255 million, due to rising materials costs and concerns over trade wars. Housing starts were 10.90 percent higher year-over-year.

Single-family housing starts were lower by 3.70 percent lower than for February, but were 8.00 percent higher year-over-year. This suggests that aside from seasonal fluctuations, home builders are boosting their efforts to keep up with demand for homes.

Building permits issued increased in March to 1.354 million on a seasonally-adjusted annual basis; the February reading showed 1.321 million building permits issued. Building permits issued in March were 2.50 percent higher than for February and 7.50 percent higher year-over-year.

Mortgage Rates, Jump, New Jobless Claims Dip

Freddie Mac reported higher average mortgage rates last week, with the rate for a 30-year fixed rate mortgage rising by five basis points to 4.47 percent. This was the highest average rate for 30-year fixed rate mortgages since January 2014 and the highest weekly rate increase since February. Rates for 15-year fixed rate mortgages averaged 3.94 percent and increased by seven basis points.

The average rate for 5/1 adjustable rate mortgages was six basis points higher at 3.67n percent. Discounts 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.

New jobless claims were lower last week with 232,000 new claims filed. Analysts expected 230,000 new claims based on the prior week's reading of 233,000 new claims filed.

What's Ahead

This week's economic reports include readings from Case-Shiller Home Price Indices, sales reports for new and previously-owned homes, and weekly readings on average mortgage rates and new jobless claims. A monthly reading for consumer sentiment will be released Friday.

What's Ahead For Mortgage Rates This Week - March 26th, 2018

Last week's economic releases included readings on new and pre-owned home sales and the Federal Open Market Committee's customary post meeting statement. Fed Chair Jerome Powell gave his first press conference as Chair of the Federal Reserve and FOMC. Weekly readings on mortgage rates and first-time jobless claims were also released.

February Sales of Pre-Owned Homes Exceed Expectations, New Home Sales Fall Short

Sales of previously-owned homes exceeded expectations at a seasonally-adjusted annual rate of 5.54 million sales. Analysts expected a rate of 5.40 million sales based on January's reading of 5.38 million sales.

Lawrence Yun, National Association of Realtors® Chief Economist, said that low inventories of available homes continued to impact rising home prices. Mr. Yun said that he did not expect any let-up on home price growth. February's inventory of available homes slipped to a 3.4 months supply; a six-months supply of homes for sale is considered average and an indication of healthy housing markets.

Mr. Yun said that he may adjust forecasts for home price growth. First-time buyers are being squeezed out of housing markets due to rapidly rising home prices. The average price for a home was $241,700 in February. First-time buyer participation dropped to 29 percent of buyers as compared to an average of approximately 40 percent.

Regional sales of pre-owned homes were mixed. Sales in the Northeast dipped 12.30 percent; Midwest sales dipped by 2.40 percent. The South posted 6.60 percent growth in home sales, and the West reported 11.40 percent growth in home sales year-over-year.

Sales of new homes dipped in February.to 618,000 sales as compared to expectations of 630,000 sales and January's reading of 622,000 sales of new homes. Combined effects of seasonal weather and homebuyer concerns over rising mortgage rates and home prices likely contributed to the drop in new home sales.

FOMC Raises Key Rate, New Fed Chair Sees Stronger Economy

The Federal Reserve's Federal Open Market Committee raised the target federal funds rate to a range of 1.50 -1.75 percent, a move that was widely expected. Fed Chair Jerome Powell indicated that the Fed would continue a modest pace of raising rates in 2018 but indicated a more aggressive pace for raising rates may be appropriate in 2019.

Federal Reserve analysts predicted eight rate hikes between 2018 and the end of 2020; this estimate includes that last three rate increases. Wednesday's rate hike was the sixth quarter-point rate hike since December 2015.

Federal Reserve Chairman Jerome Powell gave his first press conference as Fed Chair after the FOMC post-meeting statement. He indicated he is not fearful of inflation overheating and said that he would protect recent tax cuts.

Mortgage Rates, New Jobless Claims Rise

Freddie Mac reported that mortgage rates ticked up by one basis for all three types of mortgages it tracks. The average rate for a 30-year fixed rate mortgage was 4.45 percent; the rate for a 15-year fixed rate mortgage averaged 3.91 percent and the average rate for a 5/1 adjustable rate mortgage was 3.68 percent. Discount points averaged 0.50 percent for fixed rate mortgages and 0.40 percent for 5/1 adjustable rate mortgages.

New jobless claims rose last week to 229,000 new claims filed as compared to an expected reading of 225,000 new claims and the prior week's reading of 226,000 new jobless claims filed. Analysts noted that winter readings for jobless claims can be unpredictable and don't indicate weakening job markets.

What's Ahead

This week's scheduled economic releases include readings from Case-Shiller on home prices, readings on pending home sales and weekly reports on mortgage rates and new jobless claims.

What's Ahead For Mortgage Rates This Week - March 19th, 2018

Last week's economic news included readings From National Association of Home Builders, Commerce Department reports on housing starts and building permits issued Weekly readings on mortgage rates and new jobless claims were also released.

NAHB Posts 3^rd Consecutive Decline in Builder Confidence

According to the National Association of Home Builders, builder confidence in housing market conditions dropped by one point in March to an index reading of 70. Three sub-categories of builder sentiment used to calculate the overall reading were either unchanged or lower than February readings.

Confidence in current market conditions were unchanged at 72, Builder confidence in market conditions for the next six months fell two points to an index reading of 78. The index for buyer traffic in new housing developments dipped three points to 51. Any reading over 50 indicates positive builder sentiment.

Builders cited increased demand for homes as a positive influence on builder confidence, but recent decisions to impose tariffs on some building materials concerned builders, but pronounced shortages of new and pre-owned homes contributed to positive builder sentiment.

Mortgage applications for new homes were 4.60 percent higher year-over-year in February according to the Mortgage Bankers Association.

Housing Starts Lower in February

The Commerce Department reported an annual rate of 1.236 million housing starts in February; this was seven percent lower than January's reading of 1.329 million starts. Analysts expected a reading of 1.25 million starts. Housing starts were higher in the Northeast regions, but the Midwest, South and Western regions reported fewer starts in February than for January.

Permits for building new homes slipped by 5.70 percent in February, but ups and downs in construction activity during winter months can cause volatility in readings for permits and housing construction.

Mortgage Rates Mixed, New Jobless Claims Dip

Freddie Mac reported lower fixed mortgage rates for the first time in 2018; the average rate for a 30-year fixed rate mortgage was two basis points lower at 4.44 percent, Rates for 15-year fixed rate mortgages averaged 3.90 percent, which was four basis points lower than for the prior week. Mortgage rates for a 5/1 adjustable rate mortgage averaged 3.67 percent, an increase of four basis points on average.

First time jobless claims dipped last week to 226,000 new claims. Analysts expected new claims to drop to 228,000 new claims based on the prior week's reading of 230,000 new jobless claims. The week ended on a positive note with consumer sentiment rising from an index reading of 99.7 to 102 in March. The Consumer Sentiment Index is produced by the University of Michigan.

What's Ahead

This week's scheduled economic reports include readings on sales of new and previously-owned homes; the Federal Open Market Committee of the Federal Reserve will issue its customary post-meeting statement, and Fed Chair Jerome Powell will give a press conference after the FOMC statement. Weekly readings on mortgage rates and new jobless claims will also be released.

What's Ahead For Mortgage Rates This Week - March 5th, 2018

Last week's economic releases included readings on new home sales, pending home sales and Case-Shiller Home Price Indices. Construction spending and consumer sentiment reports were also released, along with weekly readings on average mortgage rates and new jobless claims.

New Home Sales Drop in January

New home sales were reported at a seasonally-adjusted annual rate of 593,000 sales in January according to the Commerce Department. Analysts expected a rate of 693,000 sales based on December's upwardly revised rate of 643,000 sales of new homes. January's reading was 7.80 percent lower than for December; January's reading was one percent lower than for January of 2017.

The average price of a new home was $323,000, which was 2.40 percent higher than for January 2017. The current supply of new homes for sale is 15 percent higher year-over-year, which is expected to ease low inventories of available homes.

Meanwhile, pending home sales were 4.70 percent lower in January than for December, which was unchanged as compared to November. Analysts said that sales activity, which is typically slow in January, was not likely a concern overall.

Case-Shiller Reports Higher Home Prices in December

Home prices were 6.30 percent higher year-over -year in December according to Case-Shiller's 20-city home price index and were 0.60 percent higher month-to-month. The top three cities leading year-over-year home price growth were Seattle, Washington at 12.70 percent, Las Vegas, Nevada with 11.10 percent growth and San Francisco, California with 9.20 percent growth in home prices.

None of the 20 cities in the index saw home prices fall in 2017 even after adjustments for inflation.

Construction spending was unchanged in January as compared to analyst estimates of 0.40 percent growth in spending. Builders cited concerns over higher materials prices and shortages of lots and skilled labor. Winter weather was also a factor in lower construction spending.

Mortgage Rates Rise New Jobless Claims Fall

Freddie Mac reported higher average rates for fixed rate mortgages last week; rates for 5/1 adjustable rate mortgages were lower on average. Mortgage rates for a 30-year fixed rate mortgage averaged three basis points higher at 4.43 percent. Rates for a 15-year fixed rate mortgage averaged 3.90 percent and were five basis points higher.

The average rate for a 5/1 mortgage was three basis points lower at 3.62 percent. Discount points averaged 0.50 percent for fixed rate mortgages and 0.40 percent for 5/1 adjustable rate mortgages. Mortgage rates rose for the eighth consecutive week, which caused concerns about affordability for first time and moderate-income home buyers. Combined effects of rapidly rising home prices and higher mortgage rates may sideline buyers.

New jobless claims fell by 10,000 to 210,000 first-time claims filed last week. Analysts expected 226,000 new claims based on the prior week's reading of 220,000 new claims filed. In other news, the University of Michigan reported a lower reading for consumer sentiment in February with an index reading of 99.7 against an expected reading of 100.0 and January's reading 0f 99.9.

What's Ahead

This week's scheduled economic news includes multiple readings from the labor sector along with weekly reports on mortgage rates and new jobless claims.

What's Ahead For Mortgage Rates This Week - February 26th, 2018

Last week's economic releases included minutes from the most recent FOMC meeting, a report on January sales of pre-owned homes and weekly readings on mortgage rates and new jobless claims.

FOMC Minutes: Economic Strength Hints at More Rate Hikes

Minutes of the January 30-31 meeting of the Fed's Federal Open Market Committee indicated that most Committee members believe that inflation will reach the Fed's goal of 2.00 percent. Members found that the economy was stronger since 2017 and expected "a gradual upward trajectory of the federal funds rate would be appropriate."

While analysts expect three rate hikes in 2018, the FOMC voted to hold the federal funds rate at 1.25 to 1.50 percent. Most FOMC members expected that the goal of 2 percent inflation was within reach in 2018.

Analysts were not as confident about reaching to Fed's inflation goal. Instead, the said that in response to tax cuts, the labor market could exceed full employment and lead to higher wages and surging inflation.

A minority of FOMC members said that inflation could fall short of the Fed's goal as retailers would compete by lowering prices.

Existing Home Sales Drop in January

According to the National Association of Realtors®, sales of previously-owned homes dipped from a seasonally-adjusted annual rate of 5.56 million sales to 5.38 million sales in January. This reading was the lowest in more than three years; it could indicate that the shortage of homes for sale has reached critical mass.

Months of short supplies of homes for sale have caused rapidly rising home prices, buyer competition and fewer choices of homes for would-be buyers. Real estate pros have repeatedly said the only solution to shortages of available homes is that builders must build more homes but increasing materials costs and labor shortages have caused construction pace to lag demand for homes. Affordability continued to weigh on moderate-income and first-time buyers

Mortgage Rates Rise for 7^th Consecutive Week

Freddie Mac reported higher mortgage rates on average last week. The average rate for a 30-year fixed rate mortgage was two basis points higher at 4.40 percent; rates for a 15-year fixed rate mortgage averaged one basis point higher at 3.85 percent. The average rate for a 5/1 adjustable rate mortgage was two basis points higher at 3.65 percent.

New jobless claims dropped by 7000 first-time claims and regained a 45-year low. 222,000 new claims were filed last week as compared to expectations of 229,000 new claims and 230,000 new claims filed the prior week. Real estate pros and analysts cite strong labor markets as driving housing markets and high demand for homes. Workers with job security and options for advancement in their careers are more likely to consider investing in a home than paying rising rents.

What's Ahead

This week's scheduled economic releases include Case-Shiller Home Price Indices, readings on new and pending home sales and construction spending. Weekly readings on mortgage rates and new jobless claims will be released along with a report on consumer sentiment.

What's Ahead For Mortgage Rates This Week - February 20th, 2018

Last week's weeks economic releases included readings on the NAHB Housing Market Index, housing starts and building permits issued and consumer sentiment. Weekly readings on mortgage rates and new jobless claims were also released.

NAHB: Builder Confidence in Housing Market Holds Steady in February

The National Association of Home builders reported an index reading of 72 for its Housing Market Index in February. January's reading was also 72; readings over 50 indicates that more builders than fewer are confident about housing market conditions.

Three readings comprising the overall NAHB HMI reading include builder confidence in current market conditions, which was one point lower in February at 78. Builder confidence in housing market conditions in the next six months rose two points to an index reading of 80.

This was the highest reading for future housing market conditions since before the recession. Builder confidence in buyer traffic in new housing developments was unchanged at 54.

Builders surveyed cited strong labor markets and short supplies of pre-owned homes as fueling confidence in current market conditions, but identified ongoing labor and lot shortages and rising materials costs as concerns for builders.

Housing Starts, Building Permits Issue Rise in January

High builder confidence was reflected in readings for housing starts and building permits issued in January. Housing starts rose to their highest level in more than 10 years. The annual pace of housing starts reached 1.326 million starts.

January's reading exceeded expectations of 1.324 million starts and December's reading of 1.209 million housing starts. January's starts reflect strong builder confidence readings and may also signal future relief for short supplies of available homes and high demand for homes in many metro areas.

High demand for homes has caused rapid appreciation in home values and sidelined first-time and moderate-income buyers in areas with high home values. According to the Commerce Department, building permits issued rose to 1.396 million from December's1.380 million starts annually.

The University of Michigan reported the second highest reading for consumer sentiment in 14 years. February's reading of 99.9 was higher than expectations for a reading of 95.3 and January's reading of 95.7Analysts said that recent tax cuts likely stabilized consumer outlook in spite of volatile financial markets.

Mortgage Rates, New Jobless Claims Rise

Freddie Mac reported higher mortgage rates for all three types of mortgages it tracks in its Primary Mortgage Market Survey. Rates for a 30-year fixed rate mortgage rose an average of six basis points to 4.38 percent.

The average rate for a 15-year fixed rate mortgage was seven basis points higher at an average of 3.84 percent. Rates for a 5/1 adjustable rate mortgage averaged 3.63 percent, which was six basis points higher than the prior week.

New jobless claims were higher last week with 230,000 new claims filed, which matched expectations and exceeded 223,000 new jobless claims filed the prior week.

What's Ahead

This week's economic releases include readings on existing home sales along with weekly readings on mortgage rates and new jobless claims. Financial markets were closed on Monday for President's Day.

What's Ahead For Mortgage Rates This Week - February 12th, 2018

Jerome "Jay" Powell was sworn in as Chair of the Federal Reserve amidst wild fluctuations in U.S. stock markets. Analysts attributed sliding stock prices to fears over inflation.

Mr. Powell, who follows former Fed Chair Janet Yellen, introduced himself via a video clip on the Fed's website. Weekly readings on mortgage rates and new jobless claims were also released.

New Fed Chair Promises "Transparency" in Video Introduction

In a video introduction posted on the Fed's website, new Fed Chair Jay Powell promised that the Fed would explain "what we are doing and why we are doing it." Mr. Powell did not address stock market volatility but said that monetary policy decisions would be made based on the Fed's dual mandate of achieving maximum employment and price stability along with economic growth.

Mr. Powell took leadership of the Fed as the national unemployment rate dipped to 4.10 percent.

Mr. Powell is an attorney by profession and is the first Fed Chair not to hold a PhD in economics in more than 30 years.

Former Treasury Secretary Advises Against Raising Rates Too Fast

Former Obama administration Treasury Secretary Larry Summers cautioned against raising rates too fast: "If the Fed raises rates sufficiently to assure financial stability, there is a risk that the economy will slow too much.

When the Federal Reserve raises its target federal funds rate financial institutions, mortgage lenders and retail lenders usually follow suit.

Mortgage Rates Rise, New Jobless Claims Fall

Freddie Mac reported higher mortgage rates last week. The average rate for a 30-year fixed rate mortgage was 10 basis points higher at 4.32 percent; the average rate for a 15-year fixed rate mortgage rose by nine basis points to 3.77 percent.

The average rate for a 5/1 adjustable rate mortgage gained four basis points to 3.57 percent. Discount points averaged 0.60 percent, 0.50 percent and 0.40 percent respectively.

New jobless claims fell to their lowest level since the 1970s. 221,000 first-time claims were filed as compared to 232.000 new claims expected and the prior week's reading of 230,000 new claims filed.

What's Ahead

This week's economic news releases include readings on inflation, retail sales and the National Association of Home Builders Housing Market Indices. Readings on housing starts and building permits issued will also be released, along with weekly readings on mortgage rates and new unemployment claims.

The 2017 Mortgage Rate Outlook: Here's What the Experts Are Saying

The post-election period is often one of uncertainty, and the time since the 2016 election has been no different with regards to market force and the financial world. With a new administration taking office, there are many questions regarding how Donald Trump's presidency will impact the market and your mortgage. If you're wondering what the predictions are for the coming year, here are a few things the experts are considering.

An Increase In Rates

Due to an expected hike in rates by the Federal Reserve, it's unlikely that potential homebuyers will be able to get the low interest rates of previous years. While higher rates are likely, the proposed tax plan and budget of Donald Trump may lead to increased inflation and could also have an impact on rates down the road. The low rates of previous years certainly made homeownership a more feasible option, but it's still a good time to get into a home before they rise even more.

Less Red Tape

The money invested into regulations is something that Donald Trump was highly critical of in the run up to the election, and this may mean many opportunities for home ownership that did not exist before. While a poor credit history can make or break a mortgage application, in a time of loosening regulations there will likely be more available mortgage products for those who have a less than stellar financial situation.

Privatizing Loan Programs

There is the possibility that government-sponsored home loan organizations like Freddie Mac and Fannie Mae will come under new ownership. While this may provide an opportunity for potential homeowners, because the risk will be taken on by private owners – and not the government – this may lead to higher rates. As Jordan Levin of the California Association of Realtors says, "I can say with a pretty good level of confidence that it will increase the cost of borrowing because there's going to be more risk from those pools being borne by the private sector and they're going to want to be compensated for that additional risk that they're bearing."

While the economic policy of the coming years has yet to take shape, the mortgage rates are on the rise and the regulations surrounding home ownership are likely to loosen.

Worried About Future Mortgage Rate Increases? Here's How to 'Stress Test' Your Finances

When it comes to real estate, there are always going to be upswings in the market that will have an impact on your mortgage payment and overall financial health. However, with a fluctuating market here to stay, you may be wondering how you can guard your biggest investment and your finances against rate increases. If you're concerned about rates on the rise, here are a few tips to test out your fiscal well-being.

Calculate Your Debt-To-Income Ratio

It's beneficial to determine your DTI ratio prior to purchasing a home, but since debt and housing costs are always fluctuating, calculating this number again can be a wakeup call. By adding up your monthly expenditures (including any debt), and dividing that number by your pre-tax income, you'll be able to determine your DTI percentage. While it's ideal to have a percentage of less than 28%, if your expenditures have risen above this number, it may be time to take a look at your monthly budget and see what you can cut out.

Do You Have Emergency Savings?

Many people make a habit of putting money into their retirement funds each paycheck, but it's equally important to have emergency savings you can access in the event of car repairs, home maintenance issues or an unforeseen medical problem. While it's often suggested that a person should have a minimum of 3 months of expenses at their disposal, saving more than this can make you even more prepared in the event that a rate increase requires you to dive into other funds.

Review Your Budget

It's easy enough to have a monthly budget, but the hard part for most people is sticking to it on a day-to-day basis. If you've veered off the trail a little bit in this regard, sit down to review your expenditures and determine what your financial outlook would be if you experienced an interest rate bump next month. In the event that there's very little cushion and no money for savings, it may be worth your time to craft a new budget that gives you a bit more wiggle room.

Many people are uncertain about what the short-term economy will bring for their mortgage rates, but by reviewing your budget and maintaining emergency savings, you can be better prepared for the future. If you're currently considering purchasing a home, contact one of our real estate professionals for more information.

The First-Time Home Buyer's Guide to Getting the Best Possible Mortgage Rate

Whether they're found online or heard from family and friends, there are so many mortgage tips out there that it can be hard to know exactly how to proceed. But, if you're new to the market, there are a few surefire things you can do to get a mortgage rate you'll feel good about. For some of the best tips on getting a great loan, look no further than the following.

Know Your Credit History

It's a simple fact that one of the most important factors in your mortgage application is your credit history, so good or fair, it's important to be aware of where you stand. While the acceptable credit score for mortgage approval can fluctuate, the best rates are often available to those with a score that is higher than 760. In order to improve your chances, get a copy of your credit report and pay attention to any discrepancies that might be in it. These can have a negative impact on your score and your application, so you'll want to have them revised if they're incorrect.

Save Your Down Payment

It's not a requirement of mortgage approval to put 20% down, but a down payment of this size will lower your debt-to-income ratio and will make you a more solid bet for the lender. By having 20% in the bank to go towards your home investment, you will also be able to qualify for a lower rate. Not only this, you will not be required to pay mortgage insurance which means a lowered monthly payment and a higher disposable income in the event of market fluctuations.

Consult With A Mortgage Professional

You may want to pursue a mortgage on your own, but having a professional to help you with the process can be beneficial for a number of reasons. A mortgage expert will not only be aware of market conditions, they will have a relationship with the lenders that means they may be able to get you a rate you wouldn't be offered on your own. While you may want to go it alone, there are benefits to consulting a professional.

There's a lot involved in the mortgage process, but by putting 20 percent down and having a good credit history, you'll be well on your way to a great rate.

How Will Having a New President Impact Your Mortgage? Let's Take a Look

There is always uncertainty in the market in an election year, but many people are wondering exactly what kind of impact Donald Trump's election will have on their mortgage and the real estate options available. Whether you are still paying off your home or have been shopping around for the right one, here are some possibilities for the real estate market following the results of the 2016 election.

An Increase In Luxury Properties

With the release of Donald Trump's tax plan which provides the most sizeable tax cuts to the wealthy, it could be the case that there will be an increase in the demand for high-end properties which may lead to less availability and a higher price point. As this kind of demand could also work to bump up the median price of real estate in urban areas, it could have an adverse impact on low-income earners who may see themselves priced out of a more expensive market.

Rising Mortgage Rates

Most people that have been perusing the market recently have heard about the low interest rates that make purchasing a home a good financial decision. However, following the uncertainty of the election, interest rates are on the rise. While the sense of instability may persist until potential homebuyers know more, this boost in the rates since the election may mean that many buyers will decide to hold off for a while.

A Loosening Of Regulations

The concept of the cost involved in regulation was something that Donald Trump brought up many times on the campaign trail, and this could be a sign that he is ready to make adjustments when it comes to housing regulations. While there may be little he can do at the local level, if regulation changes take hold, this could mean more loan opportunities for those with a poor credit history who may not have been a shoe-in for a mortgage previously.

With the fluctuations of the market dependent upon a variety of factors, it's hard to say what will occur in the mortgage market in the next few months and years. However, with mortgage rates on the rise and the potential change in regulations, it could continue to fluctuate until there is more certainty on the horizon.

On a Variable Mortgage? 3 Signs Your Mortgage Payment Is About To Increase

For many homebuyers who are new to the market, it can be very comforting to be on a fixed rate mortgage where fluctuating interest rates cannot have an impact on your monthly payments. While a variable rate mortgage can sometimes lead to significant savings at the end of the day, there are a few ways you can tell if your monthly payment is on the upswing.

An Increase In Your Home's Value

A marked increase in a home's value is ideal for most homeowners who consider their home an important investment. However, the downside of an increase in the price of real estate is that your property taxes will probably be bumped up along with it. According to Josh Moffitt at Silverton Mortgage, "If your home value increases because of market conditions, taxes will follow, and it will cost more to insure the home." In order to determine if a higher payment is on the horizon, you may want to take a look at the listings in your neighborhood.

A Miscalculation

Most people hope that a re-assessment of the value of their home will lead to a bump in its price, but if your monthly mortgage payments were calculated at a specific time during the transaction, this bump may mean a higher monthly payment for you. If there was some overlap between the assessment and the property transfer, or other fees were included in your payment, your tax professional should be able to advise you on the best course of action you can take come tax time

Insurance Renewal Is Up

In the event that the homeowner's insurance on your home is about to expire, there's a possibility that you'll be paying a bit more following renewal. Instead of leaving this to chance, ensure that your insurance company is communicating with you and keeping you abreast of changes. After all, while insurance is important to protect your investment, you have the option of looking into other insurance providers who may be able to give you a better rate.

It can be hard to plan for the increase in rates that can go along with a variable rate mortgage, but if your insurance is up for renewal and the value of the homes in your area has increased, a higher monthly payment will likely follow. Contact your trusted real estate professional for more information.

The 4 Most Common Mortgage Questions, Answered

Making the decision to purchase a home is one of the most significant investments most people will make in their life, and this automatically means there are a lot of questions that need to be answered before putting any money down. If you're considering making the leap, here are some insights into some of the common questions you might have.

How Much Should You Put Down?

While many homebuyers have the option of putting as little as 3% down in order to purchase a home, there are benefits to saving up for a down payment and putting in 15 or 20%. Because your interest rate will be higher on a lower down payment, putting more down can mean a lower overall price tag and monthly payment.

Fixed or Variable Rate Mortgage?

While a fixed rate mortgage can be good for homeowners who are new to the market due to its stability, a variable rate can be hard to rely on because it can change all of the time. Fixed rates can end up costing more than variable rates in the event of low interest rates, but it's important to determine your comfort level with the market is before deciding on your mortgage type.

How Will The Lender Assess You?

There are a number of different factors that lenders will assess you on including your income, personal debt load, employment and credit history. While it's important to be in the good books for these reasons, a lower credit score does not mean you will not be able to qualify for a mortgage; it simply means that you may need to provide a higher down payment.

What Will The Monthly Payment Be?

One of the conundrums of home ownership is being able to determine what you'll actually be paying per month to purchase your home, but this number is dependent on the size of your mortgage, your interest rate, and the frequency of your payments. There are also many handy online tools you can use to provide some estimates but it's best that you consult your mortgage specialist about this.

Most homeowners, particularly those that are new to home ownership, have many questions when it comes to purchasing a home, but by being aware of what a lender looks at and what you should put down, you're well on your way to a healthy attitude towards ownership. If you're currently considering buying a home, contact your local real estate professional for more information.

What's Ahead For Mortgage Rates This Week - March 21, 2016

Housing Starts Up in February

Shortages of available homes are a major factor in rising home prices; shortages also make it more difficult for buyers to find homes they want. Housing starts in February rose, which is good news for the peak spring and summer home buying season. Other housing related news released last week included the Fed's decision not to raise the target federal funds rate and Housing Starts and Building Permits reports issued by the Commerce Department. Consumer Sentiment was also released along with regularly scheduled releases on mortgage rates and weekly unemployment claims.

Builder Confidence Holds Steady, Real Estate Pros Call for More Construction

According to the NAHB/Wells Fargo Housing Market Index for March, home builder confidence held steady at a reading of 58. Analysts expected an uptick to 59 based on February's reading of 58. Any reading above 50 indicates that more builders have confidence in housing market conditions than those who do not. The overall HMI reading is based on three components including builder perception of current market conditions, market conditions within the next six months and buyer foot traffic in new home developments.

Builder confidence in current market conditions held steady at a reading of 65. Builder confidence in market conditions within the next six months dropped three points to 65. Builder confidence in buyer foot traffic increased four points to a reading of 43. Confidence in buyer foot traffic has not topped a reading of 50 since 2005.

High demand for homes coupled with a short supply of affordable suburban single family homes compelled NAR Chief Economist Lawrence Yun to comment, "Imbalances in supply and demand and unhealthy levels of price growth in several metro areas have made buying a home an onerous task for far too many first-time buyers and middle class families." Mr. Yun called for builders to double their focus on building single family homes.

Housing Starts Hit 9-Year High in February

Reports on housing starts and building permits issued indicate good news for the shortage of available homes.

The Commerce Department reported that housing starts rose from January's reading of 1.120 million starts to an annual level of 1.178 million starts. Analysts expected a reading of 1.153 million starts. Building permits also increased from January's reading of 1.120 million permits to 1.167million permits issued. Analysts forecasted a reading of 1.210 million in February.

Mortgage Rates Rise, Fed Holds Interest Rate Steady

The Federal Reserve announced its decision not to raise the target federal funds rate on Wednesday. The current rate is 0.250 to 0.50 percent. Policymakers cited concerns over global economic developments as a reason for their decision. This decision quickly showed an impact on Thursday. Freddie Mac reported average rates rose across the board. The rate for a 30-year fixed rate mortgage rose five basis points to 3.73 percent. 15-year mortgage rates averaged 2.99 percent, which was three basis points higher than the prior week's reading. The average rate for a 5/1 adjustable rate mortgage rose by one basis point to 2.93 percent. Discount points averaged 0.50, 0.40 and.50 respectively.

Weekly jobless claims rose to 268,000 against expectations of 268,000 new claims and the prior week's reading of 258,000 new jobless claims.

Consumer sentiment dropped to 90.00 in March against an expected reading of 92.10 and February's reading of 91.70. Consumer outlook is important to housing markets as the decision whether or not to buy a home is typically based on potential buyers' evaluations of job stability and affordability of available homes.

What's Ahead This Week?

This week's scheduled economic releases include reports on new and existing home sales as well as usual weekly releases on mortgage rates and new jobless claims.