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What’s Ahead For Mortgage Rates This Week – October 1st, 2018

October 1, 2018 by Kay Monigold

What's Ahead For Mortgage Rates This Week - October 1st, 2018Last week’s economic readings included reports on home prices, new and pending home sales and remarks released by the Federal Open Market Committee of the Federal Reserve. Weekly readings on average mortgage rates and first-time jobless claims were also released.

Case-Shiller HPI: Home Price Growth Slows in July

Home prices grew slower in July according to data released last week. Home prices rose at a seasonally-adjusted annual rate of 6.0 percent in July as compared to June’s rate of 6.2 percent growth. Analysts cited increasing inventories of homes available, which typically increases competition and lowers asking prices. Would-be home buyers have also suspended their home searches due to slim supplies of homes and competition with cash buyers.

New and Pending Home Sales Show Mixed Results

Sales of new homes rose in August according to the Commerce Department. New homes sold at a seasonally adjusted annual rate of 629,000 sales. Analysts expected a reading of 625,000 sales New home sales grew by 3.50 percent from July to August and were 12.70 percent higher year-over-year. New homes sold for an average price of $320,200 in August, which was a year-over-year price increase of 1.90 percent.

Pending home sales dipped in August with a reading of – 1.80 percent in August as compared to July’s reading, which was also negative at 0.80 percent. Pending sales typically slow as fall approaches and peak hone buying season ends. Pending home sales indicate what’s ahead in closed home sales and mortgage loans. Analysts said that government readings on home sales are gleaned from small samples and are subject to adjustment.

Mortgage Rates, New Jobless Claims Rise.

Freddie Mac reported higher mortgage rates last week after the Federal Reserve announced that it would raise its target federal funds range to 2.00 to 2.25 percent. Analysts said that the Federal Open Market Committee dropped the term “accommodative” in its post-meeting announcement on Wednesday.

Interest rates for a 30-year fixed rate mortgage averaged 4.72 percent, which was an increase of seven basis points. The average rate for a 15-year fixed rate mortgage rose five basis points to 4.16 percent and the average rate for a 5/1 adjustable rate mortgage rose five basis points to 3.97 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 also rose last week with 214,000 first-time claims filed as compared to expectations of 216,000 new claims filed and the prior week’s reading of 202,000 new claims filed. High numbers of claims filed in Kentucky, North Carolina and South Carolina suggested that the jump in initial claims related to Hurricane Florence.

What‘s Ahead

This week’s scheduled economic releases include readings on public and private-sector jobs growth, the national unemployment rate and construction spending. Weekly readings on mortgage rates and new unemployment claims will also be released.

Filed Under: Financial Reports Tagged With: Case Shiller, Interest Rates, Mortgage Rates

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

September 24, 2018 by Kay Monigold

What’s Ahead For Mortgage Rates This Week – September 25th, 2018Last week’s economic releases included readings on the NAHB Housing Market Index, sales of pre-owned homes, and housing starts. Weekly readings on mortgage rates and first-time jobless claims were also released.

NAHB: Home Builder Confidence in Market Conditions Holds Steady

The National Association of Home Builders reported an index reading of 67 for September, which matched August’s reading. Growing concerns over impacts of tariffs on building material costs have slowed builders’ confidence in current and future market conditions.

Components of the NAHB Housing Market Index include readings on current conditions, which gained one point to 74; builder confidence in market conditions over the next six months gained two points to a reading of 74. The HMI reading for buyer traffic in new housing developments was unchanged with a reading of 49. Readings for buyer traffic are typically below the benchmark index reading of 50. Readings over 50 indicate that most home builders are confident about housing market conditions.

Builder confidence is considered an indication of future housing supplies as builders may adjust their construction plans on market conditions and building costs. The Commerce Department reported higher housing starts in August with a seasonally-adjusted annual rate of 1,282 million starts. Analysts predicated a rate of 1.249 million starts based on July’s reading of 1.168 million starts.

Sales of Previously-Owned Homes Unchanged

The National Association of Realtors® reported sales of previously-owned homes held steady in August, with homes sold at a seasonally-adjusted annual rate of 5.34 million sales. Analysts expected a reading of 5.37 million sales. Home sales have faced headwinds in recent years with high demand and low inventories of available homes driving up home prices faster than inflation and wage growth. Recently rising mortgage rates also impacted affordability and sidelined would-be buyers with moderate incomes.

Mortgage Rates Rise; New Jobless Claims Fall

Freddie Mac reported higher rates for fixed-rate mortgages with the average rate for a 30-year fixed rate mortgage rose five basis points to 4.65 percent. The average rate for 15-year mortgages also rose by five basis points to 4.11 percent. Rates for 5/1 adjustable rate mortgages dipped by one basis point to 3.92 percent. Discount points averaged 0.50 percent for fixed rate mortgages and 0.40 percent for 5/1 adjustable rate mortgages.

First-time jobless claims fell to 201,000 claims filed as compared to expectations of 208,000 new claims filed and the prior week’s reading of 204,000 new claims filed. This was a 49-year low; analysts cited Hurricane Florence and overall economic expansion.

What‘s Ahead

This week’s scheduled economic news includes readings on home prices from Case-Shiller, new and pending home sales and inflation. Weekly reports on mortgage rates and new jobless claims will also be released.

 

Filed Under: Financial Reports Tagged With: Financial Reports, Interest Rates, Mortgage Rates

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Kay MonigoldKay Monigold
Owner/Mortgage Broker/Residential Mortgage Loan Originator
NMLS#1086176

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Residential Mortgage Loan Originator
NMLS #1085638

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