Tag Archives: Financial Reports

What’s Ahead For Mortgage Rates This Week – July 2nd, 2018

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What’s Ahead For Mortgage Rates This Week – July 2nd, 2018Last week’s economic reports included readings from Case-Shiller housing market indices and data released on new and pending home sales. Weekly releases on mortgage rates and first-time unemployment claims along with the Consumer Sentiment Index for June were also posted.

Case-Shiller Reports Rapid Home Price Growth in April

April home prices ticked downward by one-tenth percent for the National Home Price Index, which reported 6.40 percent growth year-over-year. Case-Shiller’s 20-City Home Price Index also dipped by one-tenth percent to 6.60 percent year-over-year. Analysts note that home prices continue to outpace wage growth and inflation, which limits affordability for many prospective home buyers.

Seattle, Washington held the top spot on the 20-City Home Price Index with year-over-year home price growth of 13.10 percent; Las Vegas, Nevada followed with year-over-year home price growth of 12.70 percent and San Francisco, California reported home price growth of 10.90 percent year-over-year. New York, New York was the only metro area to report negative home price growth. Analysts said recent tax law changes and a glut of new apartments impacted home prices.

New Home Sales Rise as Pending Home Sales Fall

Sales of new homes rose in May to a seasonally-adjusted annual level of 689,000 sales. Analysts expected 668,000 sales based on April’s downwardly-revised reading of 646,000 new homes sold. Year-to-date, sales of new homes were 8.80 percent higher than for the same period in 2017.

Rapid home price growth has been driven by high demand and limited inventories of homes for sale. Supplies of new homes dipped from a 5.40-month supply in April to a 5.20-month supply of homes for sale. Real estate pros consider a six-month supply of homes an average inventory.

Pending home sales dipped in May by -0.50 percent,  as compared to April’s reading of -1.30 percent. Low supplies of available homes have sidelined buyers who haven’t found homes that they want or can afford. High demand has created bidding wars and cash buyers in some markets have sidelined moderate-income buyers and those who need financing to purchase homes.

Mortgage Rates Mixed, New Jobless Claims Rise

Freddie Mac reported lower average mortgage rates last week. Rates for a 30-year fixed rate mortgage fell by two basis points to 4.55 percent. Rates for a 15-year fixed rate mortgage averaged 4.04 percent and were unchanged from the prior week.

The average rate for a 5/1 adjustable rate mortgage was four basis points higher at 3.87 percent. Discount points averaged 0.50 percent for fixed rate mortgages and 0.30 percent for 5/1 adjustable rate mortgages.

New jobless claims rose to 227,000 first-time claims filed from the prior week’s reading of 218,000 claims filed. Analysts expected 220,000 initial jobless claims.

Consumer sentiment fell to an index reading of 98.20 in June as compared to May’s reading of 99.30. according to the University of Michigan.

What‘s Ahead

This week’s scheduled economic news includes readings on construction spending and minutes of the most recent meeting of the Fed’s Federal Open Market Committee, Labor sector readings on Non-Farm payrolls, ADP payrolls and national unemployment will also be released.

Weekly reports on mortgage rates and new jobless claims will be released on schedule.  U.S. Financial Markets will be closed on Wednesday in observance of Independence Day.

What’s Ahead For Mortgage Rates This Week – June 25th, 2018

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What’s Ahead For Mortgage Rates This Week – June 25th, 2018Last week’s economic reports included readings from the National Association of Home Builders, Commerce Department reports on housing starts and building permits issued. Sales of pre-owned homes were reported along with weekly readings on mortgage rates and new jobless claims.

Builder Confidence Slips as Trade Wars Boost Lumber Prices

According to the National Association of Home Builders, home builder confidence in current market conditions was down two points to 68 as compared to May’s index reading of 70. Analysts said that rising lumber prices impacted builder sentiment and have replaced labor costs as builders’ primary expense.

Increased building costs were cited as a concern for builders despite high demand for homes and limited homes for sale. Rising materials costs were attributed to trade wars caused by recent tariffs on lumber.

NAHB said that three components of the Home Builders Housing Market Index were also lower in June. Builder confidence in current market conditions slipped one point to an  index reading of 75; builder confidence in market conditions within the next six months also dropped one point to 76.

Builder confidence in buyer traffic in new housing developments dipped one point to 50. Any reading over 50 indicates more builders than fewer were confident about housing market conditions.

Housing Starts Hit 11-Year High in May

May housing starts surpassed April’s reading of 1.280 million starts on a seasonally-adjusted annual basis. May’s reading of 1.350 million starts also surpassed expectations of 1.300 million starts. Higher volume and faster pace of building homes was good news for real estate and mortgage industry pros, as building more homes is the only way to relieve marked shortages of available homes in many areas.

Rising materials costs could dampen construction pace as tariffs and resulting trade wars increase. May’s reading for housing starts was the highest since 2007 and was 20.00 percent higher year-over-year.

Building permits issued in May were 4.60 percent lower than April’s reading. Building permits were issued at a pace of 1.301 million permits on a seasonally-adjusted annual basis.

Sales of Pre-Owned Homes Slip as Supply Tightens

Previously owned homes sold at a slower pace in May as short supplies of homes constrained already tight markets. The National Association of Realtors® reported 5.43 million sales on a seasonally-adjusted annual basis. Analysts expected a reading of 5.52 million sales based on April’s reading of 5.45 million sales. May sales of previously owned homes were three percent lower year-over-year.

Analysts said that there is little relief in sight and that there is a growing disparity in home sales; sales of homes worth $250,000 or more were up six percent, while sales of homes worth less than $250,000 fell by eight percent. Short supplies of homes for sale encouraged bidding wars and sidelined first-time and moderate-income buyers.

Mortgage Rates, New Jobless Claims Lower

Freddie Mac reported lower average mortgage rates last week; the rate for a 30-year fixed rate mortgage dropped five basis points to 4.57 percent; rates for a 15-year fixed mortgage were eight basis points lower at 4.04 percent and rates for 5/1 adjustable rate mortgages were unchanged at an average of 3.83 percent.

Discount points averaged 0.50 percent for 30-year fixed rate mortgages, 0.40 percent for 15-year fixed rate mortgages and were 0.30 percent for 5/1 adjustable rate mortgages.

First-time jobless claims fell to 218,000 claims filed last week as compared to the prior week’s reading of 221,000 new claims filed and expectations of 220,000 new claims.

What‘s Ahead

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

What’s Ahead For Mortgage Rates This Week – June 4th, 2018

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What’s Ahead For Mortgage Rates This Week – June 4th, 2018Last 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 7th, 2018

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What’s Ahead For Mortgage Rates This Week – May 7th, 2018Last 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 23rd, 2018

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What’s Ahead For Mortgage Rates This Week – April 23rd, 2018Last 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 – April 9th, 2018

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What’s Ahead For Mortgage Rates This Week – April 9th, 2018Last week’s economic reports included readings on construction spending, mortgage rates and weekly jobless claims. Other labor-related claims included ADP payrolls, Non-Farm Payrolls and the national unemployment rate.

Construction Spending Rises in February

Construction spending was higher in February according to the Commerce Department. Spending on building projects rose by 0.10 percent in February Reuters reported that construction spending rose 0.10 percent as compared to expectations of an 0.40 percent increase and January’s unchanged reading. Seasonal weather conditions typically cause lulls in building. Analysts said that residential construction spending increased by 0.10 percent to its highest level since January 2007.

Real estate analysts have consistently indicated that building more homes is the only solution to lingering shortages of available homes in the U.S. Recent news about tariffs on foreign building materials may cause builders to wait and see how tariffs will impact business before going all-out on building homes.

Mortgage Rates Fall as New Jobless Claims Rise

Freddie Mac reported lower mortgage rates last week; the average rate for a 30-year fixed rate mortgage was four basis points lower at 4.04 percent.15-year fixed rate mortgage rates averaged 3.87 percent, which was three basis points lower than the prior week. Rates for a 5/1 adjustable rate mortgage averaged 3.62 percent and were four basis points lower than for the prior week. Discount points averaged 0.50 percent for 30-year fixed rate mortgages and 0.40 percent for 15-year fixed rate mortgages and 5/1 adjustable-rate mortgages.

Weekly jobless claims rose to 242,000 new claims filed as compared to 225,000 new claims expected and 218,0000 claims filed the prior week.

Labor Reports Show Mixed Results

ADP reported fewer private-sector jobs created in March with 241,000 jobs created as compared to February’s reading of 246,000 new private-sector jobs. The Labor Department reported a sharp drop in Non-Farm payrolls, which measures public and private-sector job growth. 103,000 jobs were added in March as compared to February’s revised reading of 326,000 jobs added. Jobs added in March were at their lowest level since fall 2017.

Analysts put the low Non-Farm payrolls reading in perspective; on average 202,000 jobs were added monthly during the first quarter of 2018 and jobs growth was faster than during first quarters of 2016 and 2017. The national unemployment rate was unchanged at 4.10 percent; this was the lowest rate in 17 years. Low unemployment rates typically indicate few layoffs and suggest strong economic growth.

What‘s Ahead

This week’s scheduled economic releases include readings on inflation, core inflation and consumer sentiment. The Federal Open Market Committee of the Fed will release minutes from its last meeting. Weekly readings on mortgage rates and new jobless claims will also be released.

What’s Ahead For Mortgage Rates This Week – March 26th, 2018

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What’s Ahead For Mortgage Rates This Week – March 26th, 2018Last 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

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What’s Ahead For Mortgage Rates This Week – March 19th, 2018Last 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 3rd 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 12th, 2018

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What’s Ahead For Mortgage Rates This Week – March 12th, 2018Last week’s economic releases included reports on Non-Farm Payrolls, ADP payrolls, and the national unemployment rate. Weekly readings on mortgage rates and new jobless claims were also released.

Public and Private Sector Jobs Show Mixed Readings

ADP Payrolls reported 235,000 private sector jobs added in February as compared to January’s updated reading of 243,000 jobs added. Analysts estimated 205,000 private sector jobs would be added, but this was based on the original reading of 234,000 jobs added. February was the fourth consecutive month when private sector job growth exceeded 200,000 jobs.

According to the federal government, Non-Farm payrolls added 74000 public and private-sector jobs in February for a reading of 313,000 jobs added. February’s gain was the largest in a year and a half. Analysts expected 222,000 jobs added in February. Analysts cited solid economic strength as contributing to higher-than-expected job growth.

Strong economic growth can encourage prospective home buyers to move from renting to buying a home, but first-time and moderate-income buyers continued to face headwinds including short supplies of available homes and strict mortgage requirements. Rising mortgage rates have also impacted buyers’ ability to qualify for mortgage loans.

National unemployment was unchanged at 4.10 percent.

Mortgage Rates, New Jobless Claims Rise

Mortgage rates rose again last week; the average rate for a 30-year fixed rate mortgage gained three basis points to 4.46 percent. 15-year fixed rate mortgage rates rose by four basis points to 3.94 percent. 

The average rate for a 5/1 adjustable rate mortgage rose by one basis point to 3.63 percent. Discount points held steady at 0.50 percent for fixed rate mortgages and 0.40 percent for 5/1 adjustable rate mortgages.

New jobless claims rose to 231,000 new claims filed as compared to an expected reading of 220,000 new claims and the prior week’s reading of 210,000 first-time claims filed. 

Analysts said that job growth remains robust regardless of higher first-time jobless claims. While layoffs rose in February, analysts said that anomalies including bad weather made it difficult to project February readings for first-time jobless claims.

What‘s Ahead

This week’s scheduled economic releases include readings from the National Association of Home Builders, Commerce Department reports on housing starts and building permits issued and the University of Michigan’s report on consumer sentiment. Weekly readings on mortgage rates and new jobless claims will also be released.

What’s Ahead For Mortgage Rates This Week – March 5th, 2018

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Whats Ahead For Mortgage Rates This Week – March 5th 2018Last 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.