Navy Fellas Realty Group

Real Estate, Residential sales and purchase

What’s Ahead For Mortgage Rates This Week – November 16, 2020

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What's Ahead For Mortgage Rates This Week - November 16, 2020Last week’s economic reporting included readings on inflation and consumer sentiment along with weekly readings on mortgage rates and jobless claims. Federal Reserve Chair Jerome Powell and Federal Reserve Board members addressed economic expectations resulting from the COVID-19.

Chair Powell said that there would be no quick fix for the economy and that the economy would suffer for four to six months until the pandemic slows. He also said that a COVID-19 vaccine would not be a panacea for the virus and said that “ the next few months could be challenging” as the virus spreads at a faster pace.

Inflation Stalls as Pandemic Progresses

The Commerce Department reported no growth in the Consumer Price Index and Core Consumer Price Index in October. The readings for both indices were identical with 0.00 percent growth, 0.10 percent growth expected, and September’s month-to-month growth of 0.20 percent. Medical experts predicted  that COVID-19 cases would surge as cooler weather arrived.

The cost of living rose from June to October, but this was a recovery from deep dips in consumer prices as the pandemic took hold. The year-over-year inflation rate slowed to 1.20 percent in October from September’s reading of  1.40 percent. Annual inflation was growing by 2.30 percent before the pandemic.

Mortgage Rates Rise, Jobless Claims Fall

Freddie Mac reported higher average mortgage rates last week as the rate for 30-year fixed-rate mortgages increased by six basis points to 2.84 percent. The average rate for 15-year fixed-rate mortgages rose by two basis points to 2.34 percent and rates for 5/1 adjustable rate mortgages jumped by 22 basis points to 3.11 percent. Discount points averaged 0.70 percent for 30-year fixed-rate mortgages and 0.60 percent for 15-year fixed-rate mortgages. Points for 5/1 adjustable rate mortgages averaged 0.40 percent.

First-time jobless claims fell last week to 709,000 filings. Analysts expected 731,000 new jobless claims based on the prior week’s reading of 751,000 initial jobless claims filed. Ongoing jobless claims were also lower last week with 6.79 million continuing claims filed. as compared to the prior week’s reading of 7.22 million ongoing jobless claims filed.

The University of Michigan’s Consumer Sentiment Index posted a lower reading of 77.0 in November as compared to October’s index reading of 81.6 percent and the expected reading of 82.3. The dip in the Consumer Sentiment Index reflected increased consumer concern as covid-19 cases rose,

What’s Ahead

This week’s scheduled economic reporting includes readings from the National Association of Home Builders Housing Market Index, Commerce Department reporting on housing starts, and building permits issued. Data on sales of previously-owned homes will also be reported.

What’s Ahead For Mortgage Rates This Week – November 9, 2020

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What's Ahead For Mortgage Rates This Week - November 9 , 2020Last week’s economic news included readings on construction spending, the Fed’s Federal Open Market Committee statement, and a press conference by Federal Reserve chairman Jerome Powell. Labor data on public and private sector jobs and the national unemployment rate were reported along with weekly readings on mortgage rates and jobless claims.

Residential Developments Lead September Construction Spending

High demand for homes continued to fuel home construction, but public and non-residential construction spending was slower according to the Commerce Department. Residential construction spending rose by 2.70 percent on a seasonally-adjusted annual basis while public construction spending decreased by -1.70 percent and non-residential construction spending dropped by -1.60 percent.

Changing priorities for home buyers including accommodations for work-from-home spaces and moving away from congested urban areas drove demand for  single-family homes. Commercial and public construction was sidelined as concerns over municipal spending and less revenue sidelined business and public construction spending. A new wave of COVID-19 cases also dampened commercial and public construction plans.

FOMC Statement and Fed Chair’s Press Conference

The Federal Open Market Committee of the Federal Reserve said it would leave the target Federal Funds range unchanged at 0.00 to 0.25 percent to promote access to business and personal credit. Factors contributing to the Committee’s decision included observations that demand for goods and services decreased and lower oil prices held down inflation. Committee members expected the spread of COVID-19 to impact the economy, employment, and inflation in the near term. The virus is expected to pose serious risks to economic forecasts over the medium term.

Fed Chair Jerome Powell said that the economy continued to recover from its low in the second quarter, but the pace of economic improvement has since slowed. Travel and hospitality sectors were hard-hit due to requirements for social distancing and wearing masks; Chair Powell emphasized that following public health guidelines was the only way that the COVID-19 virus could be controlled.

Mortgage Rates Mixed as Jobless Claims Fall

Freddie Mac reported mixed movement for average mortgage rates with rates for 30-year fixed-rate mortgages three basis points lower at 2.78 percent. Rates for 15-year fixed-rate mortgages averaged 2.32 percent and were unchanged. Rates for 5/1 adjustable rate mortgages averaged 2.89 percent and were one basis point higher. Discount points averaged 0.70 percent for 30-year fixed-rate mortgages, 0.60 percent for 15-year fixed-rate mortgages, and averaged 0.30 percent for 5/1 adjustable rate mortgages.

Initial jobless claims fell to 751,000 last week as compared to the prior week’s reading of 758,000 first-time claims filed. Continuing jobless claims were also lower last week with 7.38 million continuing claims filed as compared to the prior week’s reading of 7.81 million ongoing claims filed.

Public and Private  Sector Job Growth Slows in October

ADP reported 365,000 private-sector jobs added in October as compared to 753,000 jobs added in September. The Commerce Department reported 638,000 public and private sector jobs added in October as compared to the prior month’s reading of 672,000 public and private sector jobs added. The National Unemployment rate was also lower at 6.90 percent, which was lower than the expected reading of 7.60 percent and the previous month’s reading of 7.90 percent.

What’s Ahead

This week’s scheduled economic releases include readings on inflation and consumer sentiment. Weekly updates on mortgage rates and jobless claims will also be released.

What’s Ahead For Mortgage Rates This Week – November 2, 2020

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What's Ahead For Mortgage Rates This Week - November 2, 2020Last week’s economic reporting included home price data from Case-Shiller Home Price Indices along with readings on pending home sales, new home sales, and consumer sentiment. Weekly reports on mortgage rates and jobless claims were also released.

Case-Shiller: August Home Prices Rise at Fastest Pace in Two Years

Home prices rose at a seasonally-adjusted annual pace of 5.70 percent in August according to Case-Shiller’s National Home Price Index. U.S. home prices rose by 4.80 percent in July

The Case-Shiller 20-City Home Price Index showed 5.20 percent year-over-year home price growth in August.

Phoenix, Arizona, held first place in home price growth for the 15th consecutive month. Seattle, Washington followed with 8.50 percent year-over-year growth in home prices. San Diego, California reported 7.60 percent year-over-year growth in home prices.

New and Pending Home Sales Fall in September

New homes sold at a pace of 959,000 sales on a seasonally adjusted annual basis in September.  Analysts expected a sales pace of 1.033 million sales based on August’s pace of 994,000 sales. Sales fell with the end of the peak home-buying season and may have also slowed due to rising COVID-19 cases. Demand for homes has been high as buyers’ shifting priorities were expected to cause more families to relocate to less congested suburbs. Pending home sales fell by 2.20 percent in September according to the National Association of Realtors®. Signed sales contracts were 20.50 percent higher year over year.

Mortgage Rates, Jobless Claims Fall

Freddie Mac reported little change in average mortgage rates last week. Rates for 30-year fixed-rate mortgages rose by one basis point to 2.81 percent. Rates for 15-year fixed-rate mortgages averaged 2.32 percent and were one basis point higher than for the prior week. Mortgage rates for 5/1 adjustable rate mortgages also rose by one basis point on average. Discount points averaged 0.70 percent for 30-year fixed-rate mortgages, 0.60 percent for 15-year fixed-rate mortgages, and 0.30 percent for 5/1 adjustable rate mortgages.

Initial jobless claims fell last week to 751,000 new claims filed. Analysts expected 770,000 new claims filed based on the prior week’s reading of  791,000 new claims filed. Ongoing jobless claims also fell last week with 7.76 million ongoing claims filed as compared to the prior week’s reading of 8.47 million continuing jobless claims filed.

The University of Michigan’s Consumer Sentiment Index rose to an index reading of 81.8 in October as compared to September’s reading of 80.4 and an expected index reading of 81.2.

What’s Ahead

This week’s scheduled economic reports include a statement and press conference by the Fed’s Federal Open Market Committee. Construction spending data and labor sector readings on public and private sector jobs and the national unemployment rate will also be released along with weekly readings on mortgage rates and jobless claims.

Case-Shiller Reports Fastest Home Price Growth in Two Years

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Case-Shiller Reports Fastest Home Price Growth in Two YearsHome prices rose at their fastest rate in two years according to Case-Shiller Home Price Indices. The National Home Price Index for August showed 5.70 percent home price growth year-over-year as compared to 4.80 percent growth reported in July.

The Case-Shiller 20-City Home Price Index showed that home prices rose to a 5.70 percent year-over-year pace from July’s growth rate of 4.10 percent. Phoenix, Arizona held the top home price growth rate for the 15th consecutive month with year-over-year home price growth of 9.90 percent. Seattle, Washington held second place with 8.50 percent growth in home prices. San Diego, California took third place with 7.60 percent year-over-year home price growth.

According to the 20-City Home Price Index, 19 of 20 cities reported growth in home prices. Detroit, MI has not reported home price information in recent months. Analysts said that low mortgage rates, short supplies of available homes, and changing consumer preferences drove home prices higher. The COVID pandemic caused homeowners and buyers to change preferences for home location, square footage, and amenities as working from home, school closures, and avoiding crowded urban areas adjusted family priorities.

Craig Lazzara, global head of index investment strategies for S&P Dow Jones Indices, said “If future reports continue in this vein,[positive index readings], we may be able to conclude that the COVID-related deceleration is far behind us.” It’s also possible that seasonal weather conditions and resurging COVID cases could slow home sales and home price growth.

Federal Housing Finance AgencyReports Highest Home Price Growth Rate Since 2006

August readings reported by FHFA also showed higher home prices. The agency, which oversees mortgage giants Fannie Mae and Freddie Mac, reported year-over-year home price growth of 1.50 percent from July to August; home prices for homes mortgaged or owned by Fannie Mae and Freddie Mac rose by eight percent annually. 

FHFA home price data is tracked nationally by census divisions, states, and metro areas. Information is also available by county and zip code.

What’s Ahead For Mortgage Rates This Week – October 19, 2020

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What's Ahead For Mortgage Rates This Week - October 19, 2020Last week’s economic reporting included readings on inflation, retail sales, and consumer sentiment. Weekly readings on average mortgage rates and jobless claims were also released.

Inflation Rate Slows as Retail Sales Increase

Inflation rose 0.20 percent in September, which was the slowest growth rate in four months. Analysts credited the rise in consumer prices to less post-pandemic price shock as consumers adjusted to higher prices for goods. Consumer prices were boosted by used vehicle prices, which increased at their highest pace in 51 years. Core consumer prices, which exclude volatile food and fuel sectors, also rose by 0.20 percent in September as compared to August’s reading of 0.40 percent.

The Commerce Department reported higher retail sales growth in September at a pace of 1.90 percent as compared to the expected reading of 1.20 percent and August’s reading of 0.60 percent growth in sales. Retail sales excluding the automotive sector grew by 1.50 percent in September and exceeded expected sales growth of 0.30 percent, and August’s retail sales growth of 0.50 percent.

Mortgage Rates Fall to New Record Low, Jobless Claims Data Mixed

Freddie Mac reported new record lows for average mortgage rates last week as the average rate for 30-year fixed-rate mortgages fell by six basis points to 2.81 percent. Rates for 15-year fixed-rate mortgages averaged 2.35 percent and were two basis points lower. The average rate for 5/1 adjustable rate mortgages rose by one basis point to 2.90 percent. Discount points averaged 0.60 percent for 30-year fixed-rate mortgages and 0.50 percent for 15-year fixed-rate mortgages. Discount points for 5/1 adjustable rate mortgages averaged 0.20 percent.

Last week’s jobless claims data showed mixed readings as initial jobless claims rose to 898,000 claims filed and surpassed the expected reading of 825,000 new claims filed and the prior week’s reading of 845,000 initial jobless claims filed.  10.02 million continuing jobless claims were filed last week as compared to 11.18 million ongoing claims filed in the prior week.

The University of Michigan’s Consumer Sentiment Index rose in October with an index reading of 81.2; this surpassed the expected reading of 79.9 and September’s reading of 80.4. October’s higher index readings suggest that consumers are adjusting to new economic realities caused by the pandemic and revising their expectations accordingly. The upcoming holiday season’s data for retail sales and consumer sentiment will provide additional indications of how Americans are coping with and recovering from the COVID-19 pandemic.

What’s Ahead

This week’s scheduled economic reports include readings from the NAHB on U.S. housing markets Commerce Department readings on housing starts and building permits issued. Data on sales of previously-owned homes will be released along with weekly readings on mortgage rates and jobless claims.

What’s Ahead For Mortgage Rates This Week – October 12, 2020

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What's Ahead For Mortgage Rates This Week - October 12, 2020Last week’s economic reporting included readings on inflation,  job openings, a speech by Fed Chair Jerome Powell on the economy, and the latest Consumer Sentiment Index from the University of Michigan. Weekly reports on new and continuing jobless claims and mortgage rates were also released.

Hiring Surge and Job Separations Ease in August

The U.S. Department of Labor reported fewer job openings in August with 6.49 million job openings reported as compared to July’s reading of 6.70 million jobs available. Analysts noted that this indicated a slowdown in hiring after businesses re-opened when COVID-19 restrictions lapsed. Job separations, which include quits, layoffs. and terminations were also lower with 4.50 million job separations reported in August as compared to 4.99 million separations reported in July.

Fed Chair Says Economy Needs More Fiscal Support

Federal Reserve Chairman Jerome Powell said that the U.S. economy could use more support in a speech made to members of the National Association for Business Economics. Mr. Powell said, “Too little support would lead to a weak recovery, which would lead to  creating unnecessary hardships for households and businesses.”

Mr.Powell said that if too much assistance was provided, it would not go to waste; he also said that the economic recovery would be stronger and move faster if monetary policy and fiscal policy continue to work side by side to support the economy until it is clearly out of the woods. Forecasts of increased COVID-19 cases during fall and winter indicate the importance of additional economic relief measures.

Mortgage Rates Little Changed; as Jobless Claims Fall

Freddie Mac reported incremental changes in average mortgage rates last week. Rates for 30-year fixed-rate mortgages averaged 2.87 percent and were one basis point lower. The average rate for 15-year fixed-rate mortgages was one basis pint higher at 2.37 percent. The average rate for 5/1 adjustable rate mortgages fell by one basis point to 2.89 percent. Discount points averaged 0.80 percent for 30-year fixed-rate mortgages and 0.70 percent for 15-year fixed-rate mortgages. Discount points for 5/1 adjustable rate mortgages averaged 0.20 percent.

New jobless claims fell to 840,000 claims filed as compared to 849,000 initial claims filed in the prior week. Continuing jobless claims also fell last week. 10.98 million continuing jobless claims were filed as compared to the prior week’s reading of 11.98 million ongoing jobless claims filed.

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 filed will also be released.

What’s Ahead For Mortgage Rates This Week – October 5, 2020

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What's Ahead For Mortgage Rates This Week - October 5, 2020Last week’s economic news included readings from Case-Shiller Home Price Indices, along with Commerce Department readings on public and private-sector job growth and the University of Michigan’s Consumer Sentiment Index. Weekly reports on jobless claims and mortgage rates were also released.

Case-Shiller: Home Price Growth Ramps Up as Demand for Homes Increases

July home prices rose at a year-over-year rate of 4.80 percent in July as compared to June’s reading of 4.40 percent. Shortages of available homes were driven by demand. Homebuyers were looking for larger homes to accommodate working from home and also wanted to leave congested urban areas.

Home prices in Case-Shiller’s 20-City Index rose by 3.90 percent year-over-year in July; Home prices in participating cities grew by 3.50 percent in June. Home prices grew fastest in Phoenix, Arizona with a year-over-year growth rate of  9.20 percent. Seattle, Washington home prices grew by 7.00 percent, and home prices in Charlotte, North Carolina rose by 6.00 percent.

Craig Lazzara, managing director and global head of index investment strategy at S&P Dow Jones Indices, said,

“Prices were particularly strong in the Southwest and West were comparatively weak in the Midwest and Northeast.” 16 of 19 cities in the 20-City Home Price Index reported a faster growth rate for July’s home prices. Detroit, Michigan did not report data for July’s 20-City Home Price Index.

Construction spending in August jumped from July’s reading of 0.70 percent growth to 1.40 percent. This could be positive news if it indicates a faster pace of home construction, but it could also reflect higher prices for building materials. Rising costs of building materials are typically added to home prices, which further challenges first-time and moderate-income home buyers.

Mortgage Rates and Jobless Claims Fall

Freddie Mac reported lower fixed mortgage rates last week; The average rate for a 30-year fixed-rate mortgage dropped two basis points to 2.88 percent; rates for 15-year fixed-rate mortgages averaged four basis points lower at 2.36 percent. The average rate for 5/1 adjustable rate mortgages was unchanged at 2.90 percent. Discount points averaged 0.80 percent for 30-year fixed-rate mortgages and 0.70 percent for 15-year fixed-rate mortgages. Discount points for 5/1 adjustable rate mortgages 0.20 percent. 

New jobless claims fell to 837,000 claims filed from the prior week’s reading of 873,000 initial claims filed. Ongoing claims were also lower last week with 11.77 million filings as compared to 12.75 million ongoing claims filed in the previous week.

The national unemployment rate dipped below 8.00 percent for the first time since March with a reading of 7.90 percent. Analysts said that the number of people in the workforce dropped from 164.5 million in February to 160.1 million workers in September; this indicates that 4.4 million workers have left the workforce.

Consumer sentiment rose to its highest level since March according to the University of Michigan’s Consumer Sentiment Index reading for September was 80.40 as compared to August’s index reading of  74.10.

What’s Ahead

This week’s scheduled economic news includes readings on job openings and the minutes from the Fed’s Federal Open Market Committee meeting. Readings on public and private-sector jobs will also be reported.

Case-Shiller: Home Price Growth Rate Increases in July

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Case-Shiller: Home Price Growth Rate Increases in JulyHome price growth fueled by high demand for single-family homes was higher in July according to Case-Shiller’s National Home Price Index. Analysts said that millennials seeking to purchase homes and the continued exodus from large urban areas propelled rising home prices. Home prices grew fastest in the West and Southeastern regions.

While home prices grew moderately before the pandemic, high unemployment has not impeded rapid home price growth since the pandemic. Low mortgage rates and more demand for homes overcame consumers’ concerns about jobs and the economy. Analysts said that rapidly rising home prices could benefit homeowners struggling with mortgage payments as additional equity could provide more cash for relocation.

20-City Home Price Index: Three Top Cities in July

Home prices rose at the fastest pace in Phoenix  Arizona at 9.20 percent year-over-year. Seattle, Washington reported a home-price growth rate of 7.00 percent; Charlotte, North Carolina reported year-over-year home price growth of 6.00 percent. In July.

The COVID-19 pandemic caused many workers to switch from commuting to their jobs to working from home. Home-buyers also looked for homes in less-populated areas. 16 of 19 cities reported in July’s 20-City Home Price Index reported a faster pace of home price growth than in June. Detroit, Michigan did not report home prices for the July 20-City Home Price Index.

Homeowner migration from congested cities to suburbs was confirmed by Robert Dietz, the Chief Economist at the National Association of Home Builders, who said: “…builders in other parts of the country have reported receiving calls from customers in high-density markets asking about relocating.” Building single-family homes in all price ranges would help ease the shortage of homes.

FHFA Reports Highest Home Price Growth Rate From May to July

The Federal Housing Finance Agency reported a record price growth rate of more than two percent for the two months between May 1 and June 30. FHFA reports data on homes owned or financed by Fannie Mae and Freddie Mac.

What’s Ahead For Mortgage Rates This Week – September 28, 2020

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What's Ahead For Mortgage Rates This Week - September 28, 2020Last week’s economic news included readings on new and existing home sales and Fed Chair Jerome Powell’s testimony on changing the Fed’s business loan policy. Weekly readings on mortgage rates and jobless claims were also released.

Sales of New and Pre-Owned Homes Rise In August

New homes sold at a seasonally-adjusted annual pace of 1.01 million sales; analysts expected the sales pace to fall to 900,000 sales from July’s reading of 965,000 new home sales. Homebuyers turned to new homes as the supply of pre-owned homes dwindled. Homeowners stayed put as fears over COVID-19 contagion limited sales.

Pre-owned homes sold at a seasonally-adjusted annual rate of six million homes as compared to the expected reading of 6.03 million sales and 5.86 million sales in July. Previously-owned home sales rose by 2.40 percent from July to August and were 10.50 percent higher year-over-year. The sales pace from July to August was the fastest since December 2006.

The median sales price of pre-owned homes rose to $310.600 in August and the average price for pre-owned homes was 11.40 percent higher year-over-year. Inventories of available pre-owned homes were lower than the six months supply considered average; there was a three months inventory of unsold pre-owned homes in August.

Mortgage Rates, Jobless Claims Mixed

Freddie Mac reported higher fixed mortgage rates last week as the average rate for 5/1 adjustable rate mortgages fell. 30-year fixed-rate mortgages rose three basis points on average to 2.90 percent. Rates for 15-year fixed-rate mortgages averaged 2.40 percent and were five basis points higher. The average rate for 5/1 adjustable rate mortgages was six basis points lower at 2.90 percent. Discount points averaged 0.80 percent for 30-year fixed-rate mortgages, 0.70 percent for 15-year fixed-rate mortgages, and 0.20 percent for 5/1 adjustable rate mortgages.

New jobless claims rose to 870,000 new claims filed from the prior week’s reading of 866.000 initial claims filed. Continuing jobless claims fell to 12.58 million ongoing claims from 12.78 million ongoing claims filed in the prior week

In other news, Fed Chair Jerome Powell testified before the House Financial Services Committee regarding the feasibility of the Federal Reserve offering smaller business loans for COVID-19 relief. The Fed’s current minimum loan amount is $250,000; Chairman Powell told the Committee that the Fed’s loan program had few requests for loans of less than $1 million. He also said that if the minimum loan amount was changed, the current lending program would have to be scrapped and restarted from scratch.

What’s Ahead

This week’s scheduled economic releases include Case-Shiller Home Price Indices,  pending home sales and reports on public and private-sector jobs, and the national unemployment rate.

 Last week’s economic news included readings on new and existing home sales and Fed Chair Jerome Powell’s
testimony on changing the Fed’s business loan policy. Weekly readings on mortgage rates and jobless claims were
also released.
Sales of New and Pre-Owned Homes Rise In August
New homes sold at a seasonally-adjusted annual pace of 1.01 million sales; analysts expected the sales pace to fall to
900,000 sales from July’s reading of 965,000 new home sales. Homebuyers turned to new homes as the supply of
pre-owned homes dwindled. Homeowners stayed put as fears over COVID-19 contagion limited sales.
Pre-owned homes sold at a seasonally-adjusted annual rate of six million homes as compared to the expected
reading of 6.03 million sales and 5.86 million sales in July. Previously-owned home sales rose by 2.40 percent from
July to August and were 10.50 percent higher year-over-year. The sales pace from July to August was the fastest
since December 2006.
The median sales price of pre-owned homes rose to $310.600 in August and the average price for pre-owned homes
was 11.40 percent higher year-over-year. Inventories of available pre-owned homes were lower than the six months
supply considered average; there was a three months inventory of unsold pre-owned homes in August.
Mortgage Rates, Jobless Claims Mixed
Freddie Mac reported higher fixed mortgage rates last week as the average rate for 5/1 adjustable rate mortgages
fell. 30-year fixed-rate mortgages rose three basis points on average to 2.90 percent. Rates for 15-year fixed-rate
mortgages averaged 2.40 percent and were five basis points higher. The average rate for 5/1 adjustable rate
mortgages was six basis points lower at 2.90 percent. Discount points averaged 0.80 percent for 30-year fixed-rate
mortgages, 0.70 percent for 15-year fixed-rate mortgages, and 0.20 percent for 5/1 adjustable rate mortgages.
New jobless claims rose to 870,000 new claims filed from the prior week’s reading of 866.000 initial claims filed.
Continuing jobless claims fell to 12.58 million ongoing claims from 12.78 million ongoing claims filed in the prior
week
In other news, Fed Chair Jerome Powell testified before the House Financial Services Committee regarding the
feasibility of the Federal Reserve offering smaller business loans for COVID-19 relief. The Fed’s current minimum
loan amount is $250,000; Chairman Powell told the Committee that the Fed’s loan program had few requests for
loans of less than $1 million. He also said that if the minimum loan amount was changed, the current lending
program would have to be scrapped and restarted from scratch.
What’s Ahead
This week’s scheduled economic releases include Case-Shiller Home Price Indices, pending home sales and reports
on public and private-sector jobs, and the national unemployment 

 

What’s Ahead For Mortgage Rates This Week – September 21, 2020

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What's Ahead For Mortgage Rates This Week - September 21, 2020Last week’s economic news included readings on housing market conditions, housing starts, building permits issued, and consumer sentiment. Weekly readings on mortgage rates and jobless claims were also released.

National Association of Home Builders Reports Record High Builder Confidence

The NAHB reported record high builder confidence in housing market conditions. The Housing Market Index had an index reading of 83 in September as compared to August’s reading of 78. Analysts said that this builder confidence reading was notable due to rising costs for building materials.

Component readings of the NAHB Housing Market Index also rose in September. Builder confidence in current single-family housing market conditions rose four points to an index reading of 88; builder confidence in housing market conditions in the next six months rose by six points to 84. Builder confidence in buyer traffic in single-family housing developments rose by nine points to a record index reading of 73.

Builder confidence readings over 50 reflect growing builder confidence in housing market conditions. March and April fell below 50 but rebounded as demand for larger suburban homes took hold as working from home increased. Record low mortgage rates are allowing home buyers to buy larger homes with more amenities. Robert Dietz, the chief economist for the NAHB, said that “Builders in other areas of the country have reported receiving calls from customers in high-density markets asking about relocating.”

Housing Starts and Building Permits Drop in August

The Commerce Department reported 1.42 million housing starts on a seasonally-adjusted basis in August as compared to July’s reading of 1.49 million housing starts. 1.47 million building permits were issued on a seasonally-adjusted annual basis;

Mortgage Rates Mixed, Jobless Claims Fall

Freddie Mac reported mixed changes in mortgage rates; rates for 30-year fixed-rate mortgages averaged 2.87 percent and rose by one basis point. Rates for 15-year fixed-rate mortgages were two basis points lower on average at 2.35 percent. Rates for 5/1 adjustable rate mortgages averaged 2.96 percent and were 15 basis points lower. Discount points averaged 0.80 percent for fixed-rate mortgages and 0.30 percent for 5/1 adjustable rate mortgages.

Initial jobless claims fell to 860,000 from the prior week’s reading of 893,000 new claims filed. Ongoing jobless claims also fell; 12.63 million were filed as compared to the prior week’s reading of 29.67 continuing jobless claims filed.

The University of Michigan’s Consumer Sentiment Index also indicated economic growth with an index reading of 78.9 as compared to August’s reading of 74.1. Analysts expected am index reading of 75.9 for September.

What’s Ahead

This week’s scheduled economic readings include reports on new and existing home sales along with weekly reports on mortgage rates and jobless claims.