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What’s Ahead For Mortgage Rates This Week – October 25, 2021

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What's Ahead For Mortgage Rates This Week - October 25, 2021Last week’s economic reporting included the National Association of Home Builders’ Housing Market Index reports on building permits issued and housing starts, The National Association of Realtors® reported on sales of previously owned homes, and weekly readings on mortgage rates and jobless claims were also published.

NAHB: Builder Confidence Improves in September

The National Association of Home Builders reported an index reading of 80 for its September Housing Market Index. Analysts expected September’s index reading to match August’s reading of 76. Builders continued to face supply chain challenges and labor shortages amid growing concerns over rising home prices and affordability for would-be home buyers.

Component readings for the Housing Market Index also showed rising builder confidence. The index for current housing market conditions rose five points to an index reading of 87; builder confidence in housing market conditions over the next six months rose three points to 84. The gauge for buyer traffic in new single-family housing developments rose four points to an index reading of 65.

Robert Dietz, the chief economist for the NAHB, said “Policymakers must focus on fixing the broken supply chain. This will spur more construction and help ease upward pressure on home prices.”

Continuing supply chain problems caused some builders to limit building due to concerns over materials costs and availability. Shortages of small and medium homes would cause home prices to rise just as interest rates are expected to rise. These conditions add to concerns over affordability for first-time and modest-income home buyers.

NAHB HMI readings over 50 indicate that most builders surveyed have a positive outlook on housing market conditions.

September sales of previously-owned homes rose to 6.29 million homes sold on a seasonally-adjusted annual basis as compared to August’s reading of 5.88 million previously-owned homes sold and expectations of 6.10 million previously-owned homes sold. Increasing sales of pre-owned homes indicated that severe shortages of available homes during the pandemic were easing.

Mortgage Rates Rise, Jobless Claims Fall

Freddie Mac reported higher average mortgage rates last week as rates for a 30-year fixed-rate mortgage rose four basis points to 3.09 percent; rates for 15-year fixed-rate mortgages averaged three basis points higher at 2.33 percent. Rates for 5/1 adjustable rate mortgages fell one basis point to an average rate of 2.54 percent. Discount points averaged 0.70 percent for fixed-rate mortgages and 0.30 percent for 5/1 adjustable rate mortgages.

Initial jobless claims fell to 290,000 claims filed from the previous week’s reading of 296,000 first-time claims filed. Analysts expected 300,000 first-time claims to be filed. Fewer continuing jobless claims were filed last week; 2.48 million ongoing jobless claims were filed as compared to 2.60 million ongoing jobless claims filed in the previous week.

What’s Ahead

This week’s scheduled economic reporting includes readings from S&P Case-Shiller Home Price Indices, reports on sales of new and previously-owned homes, and the University of  Michigan’s Consumer Sentiment Index. Weekly readings on mortgage rates and jobless claims will also be published.

What’s Ahead For Mortgage Rates This Week – October 18, 2021

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What's Ahead For Mortgage Rates This Week - October 18, 2021

Last week’s economic reporting included readings on inflation, core inflation, and minutes of the Fed’s Federal Open Market Committee meeting held on September 22 and 23. Weekly readings on mortgage rates and jobless claims were also published.

September’s Consumer Price Index rose by 0.10 percent to 0.40 percent. The Core Consumer Price Index for September, which excludes volatile food and fuel sectors, rose by 0.10 percent to 0.20 percent and fell short of the expected reading of 0.30 percent growth.

Feds’ FOMC Meeting Minutes: Policymakers Consider Tapering Securities Purchases

Minutes of the Federal Open Market Committee meeting held September 21 and 22 indicated that policymakers discussed when to taper the Fed’s purchase of U.S. Treasuries and Mortgage-Backed Securities. Opinions were mixed as some policymakers recommended faster tapering of asset purchases and others were concerned about the potentially negative impact on financial markets if the Fed reduced its asset purchases too quickly. No specific dates for tapering asset purchases were set during the current FOMC meeting, but analysts expected the Committee to announce its plan for tapering asset purchases at its next meeting.

FOMC members also discussed inflation and were divided on their forecasts for inflation. While some members expected high inflationary growth in 2022, other FOMC members said that Covid-related bottlenecks in supply chains caused higher inflation in the near term.

Mortgage Rates Rise as Jobless Claims Fall

Freddie Mac reported higher average mortgage rates last week as rates for 30-year fixed-rate mortgages rose by six basis points to 3.05 percent. The average rate for 15-year fixed-rate mortgages rose by seven basis points to 2.30 percent; rates for 5/1 adjustable-rate mortgage rose averaged 2.55 percent and were three basis points higher Discount points averaged 0.70 percent for fixed-rate mortgages and 0.20 percent for 5/1 adjustable rate mortgages.

Initial jobless claims fell to 293,000 new claims filed as compared to the previous week’s reading of 329,000 first-time claims filed. Continuing jobless claims also fell with 2.59 million ongoing claims filed; 2.73 million ongoing claims were filed in the previous week.

What’s Ahead

This week’s scheduled economic reporting includes readings from the National Association of Home Builders on housing market conditions. Reporting on sales of previously-owned homes, housing starts, and building permits issued are expected; weekly readings on mortgage rates and jobless claims will also be released.

What’s Ahead For Mortgage Rates This Week – October 11, 2021

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What's Ahead For Mortgage Rates This Week - October 11, 2021Last week’s scheduled economic news included readings on public and private-sector jobs and the national unemployment rate. Weekly readings on mortgage rates and jobless claims were also published.

Non-Farm Payrolls: Jobs Growth Dips Sharply in September

U.S. jobs growth dipped sharply in September according to the federal government’s Non-Farm Payrolls report. 194,000 public and private sector jobs were added and fell far short of the expected reading of 500,000 jobs added. 366,000 public and private sector jobs were added in August. Hiring lagged as continuing concerns over Covid kept workers at home. Less hiring at public schools reduced September’s jobs growth at a time when schools traditionally hire for the upcoming school year.

ADP reported 568,000 private-sector jobs added in September; analysts expected 425,0000 jobs added based on 340,000 private-sector jobs added in August. In related news, the national unemployment rate fell to 4.80 percent in September as compared to August’s jobless rate of 5.20 percent. Analysts expected the national unemployment rate to drop to 5.10 percent in September.

Mortgage Rates Mixed, Jobless Claims Fall

Fixed mortgage rates fell last week as the average rate for a 30-year fixed-rate mortgage fell two basis points to 2.99 percent; rates for 15-year fixed-rate mortgages fell by five basis points on average to 2.23 percent. The average rate for 5/1 adjustable rate mortgages rose by four basis points to 2.52 percent. Discount points averaged 0.70 percent for fixed-rate mortgages and 0.30 percent for 5/1 adjustable rate mortgages

New and continuing jobless claims fell last week as 326,000 initial jobless claims were filed as compared to the previous week’s reading of 364,000 first-time claims filed. Analysts expected 345,000 initial jobless claim filings. 2.71 million continuing jobless claims were filed last week as compared to the previous week’s reading of 2.81 million ongoing jobless claims filed.

What’s Ahead

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

 

What’s Ahead For Mortgage Rates This Week – October 4, 2021

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What's Ahead For Mortgage Rates This Week - October 4, 2021Last week’s economic reporting included readings from S&P Case Shiller Home Price Indices, the National Association of Realtors®’ report on pending home sales, and the University of Michigan’s final consumer sentiment index for September. Weekly readings on mortgage rates and jobless claims were also released.

S&P Case-Shiller Reports 4th Consecutive Month of Record Home Price Growth

July Home Prices grew at a year-over-year pace of 19.70 percent as compared to June’s home price growth rate of 18.70 percent according to S&P Case-Shiller’s National Home Price Index.

The S&P Case-Shiller 20-City Home Price Index reported that July home prices grew by 19.90 percent year-over-year; 17 of 20 cities posted higher home price growth rates in September than in August. The top three home price growth rates in the 20-City Home Price Index were held by Phoenix, Arizona at 32.40 percent; San Diego, California home prices grew by 27.80 percent, and Seattle, Washington home prices grew by 25.50 percent year-over-year in September.

Craig Lazzara, managing director and global head of investment strategy for S&P Dow Jones Indices, said “The last several months have been extraordinary not only in the level of price gains but in the consistency of gains across the country.” This differed from the traditional pattern of rapid home price growth in high-demand coastal metro areas as the covid pandemic drove homebuyers to seek out less congested and less expensive metro areas.

Pending home sales rose by 8.10 percent in August according to the National Association of Realtors® and far exceeded analyst expectations of 1.20 percent growth and July’s reading of -1.80 percent growth in pending home sales. Pending home sales are sales for which purchase contracts are signed, but the transactions are not completed. Real estate pros and mortgage lenders use pending home sales to predict future home sales and loan closings.

Mortgage Rates, Initial Jobless Claims Rise

Freddie Mac reported higher mortgage rates last week as the yield on 10-Year Treasuries rose. The average rate for 30-year fixed-rate mortgages rose by 13 basis points to 3.01 percent; rates for 15-year fixed-rate mortgages also rose by 13 basis points and averaged 2.28 percent. Rates for 5/1 adjustable rate mortgages averaged 2.48 percent and five basis points higher. 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 increased to 362,000 first-time claims filed from the previous week’s reading of 351,000 new claims filed. Ongoing jobless claims decreased to 2.80 million continuing claims filed as compared to the prior week’s reading of 2.82 million continuing jobless claims filed.

The University of Michigan’s Consumer Sentiment Index rose to an index reading of  72.8 in September from August’s reading of 71.0. Analysts expected no change from August’s reading. 

What’s Ahead

This week’s scheduled economic reporting includes readings on public and private sector jobs, the national unemployment rate, and weekly readings on mortgage rates and jobless claims.

 

What’s Ahead For Mortgage Rates This Week – September 27, 2021

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What's Ahead For Mortgage Rates This Week - September 27, 2021Last week’s economic news included reporting on housing markets, housing starts, and building permits issued. Data on new and existing home sales were published along with weekly reports on mortgage rates and jobless claims.

NAHB: Builder Confidence Ticks Up as Demand for Homes Holds Steady

The National Association of Home Builders reported a one-point gain in its Housing Market Index for September with an index reading of 76. Analysts expected no change based on August’s reading of 75. Component readings for the HMI were mixed; the index reading for builder confidence in current market conditions rose one point to 82. Builder confidence in housing market conditions over the next six months was unchanged at 81 and builder confidence in buyer traffic in new single-family housing developments rose two points to an index reading of 61.

Builders continue to face headwinds as materials costs and home prices continue to rise. Home prices present a challenge to would-be buyers who don’t want to pay inflated prices or cannot qualify for mortgages based on rapidly rising home prices. Persistent shortages of homes kept homebuilders busy, but shortages of building materials forced builders to pace construction according to materials availability.

Housing starts rose to a seasonally adjusted annual pace of 1.62 million starts in August; analysts expected a pace of 1.55 million starts, which was unchanged from July’s housing starts. Building permits were issued at a seasonally-adjusted annual pace of 1.73 million permits, which surpassed the expected reading of 1.62 million permits issued and July’s reading of 1.63 million permits issued.

Existing Home Sales Fall in August as New Home Sales Rise

The National Association of Realtors® reported fewer sales of previously-owned homes in August. 5.88 million homes were sold on a seasonally adjusted annual basis as compared to July’s reading of 6.00 million pre-owned homes sold. Slim supplies of previously-owned homes for sale, rising home prices, and competition with cash buyers sidelined buyers who preferred to wait for less challenging housing market conditions.

Limited options in available pre-owned homes boosted new home sales in August. 740,000 new homes were sold on a seasonally adjusted annual basis as compared to the expected reading of 720,000 new homes sold and July’s reading of 729,000 new homes sold.

Mortgage Rates Mixed, Jobless Claims Rise

Freddie Mac reported mixed readings for mortgage rates last week as average rates for fixed-rate mortgages rose and the average rate for 5/1 adjustable rate mortgages fell. Rates for 30-year fixed-rate mortgages rose by two points and averaged 2.88 percent. The average rate for 15-year fixed-rate mortgages rose by three basis points to 2.15 percent. The average rate for 5/1 adjustable rate mortgages fell by eight basis points to 2.43 percent. Discount points averaged  0.70 percent for 30-year fixed-rate mortgages and 0.60 percent for 15-year fixed-rate mortgages. Discount points for 5/1 adjustable rate mortgages averaged 0.30 percent.

New jobless claims rose to 351,000 initial claims filed from the previous week’s reading of 335,000 initial claims filed. 2.85 million continuing jobless claims were filed as compared to the prior week’s reading of 2.71 million continuing claims filed.

What’s Ahead

This week’s scheduled economic reporting includes readings from S&P  Case-Shiller on home price growth, pending home sales, and construction spending. The University of Michigan will release its monthly Consumer Sentiment Index and weekly readings on mortgage rates and jobless claims will also be published.

What’s Ahead For Mortgage Rates This Week – September 20, 2021

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What's Ahead For Mortgage Rates This Week - September 20, 2021Last week’s scheduled economic reporting included readings on consumer prices, retail sales, and the University of  Michigan’s preliminary Consumer Sentiment Index. Weekly readings on mortgage rates and jobless claims were also released.

Consumer Price Growth Slows in August

The Consumer Price Index reported that consumer prices grew by  0.30 percent in August as compared to July’s consumer price growth pace of 0.50 percent. Core consumer prices, which exclude volatile food and fuel sectors, also slowed in August to a pace of 0.10 percent as compared to July’s reading of 0.30 percent growth. Used-car prices fell for the first time in six months but remained 32 percent higher year-over-year. Inventories of new and used cars were lower due to supply chain problems caused by the pandemic.

August’s Consumer Price Index rose by 5.30 percent year-over-year;  the Core Consumer Price Index grew by 4.00 percent year-over-year in August, which was unchanged from July’s year-over-year consumer price growth. Analysts expressed mixed opinions about how quickly inflation will slow, but Federal Reserve Chairman Jerome Powell said that the Fed expects inflation to slow to the Fed’s targeted pace of 2.00 percent within the next year. Federal Reserve policymakers expect materials and labor shortages to ease as the post-pandemic recovery continues.

Retail Sales Rise in August

Retail sales rose by 0.70 percent in August and surpassed negative projections and July’s reading of -1.80 percent. Analysts said that inflation accounted for some of the increased sales, but said that consumers were spending despite the spreading  Delta variant of the Coronavirus. Retail sales rose by 1.80 percent when automotive sales were excluded. Shortages of new and used cars dragged down the pace of retail sales.

Mortgage Rates, Jobless Claims

Freddie Mac reported little change in mortgage rates last week. Rates for 30-year fixed-rate mortgages averaged two basis points lower at 2.86 percent; Rates for 15-year fixed-rate mortgages dropped by seven basis points to 2.12 percent on average. Rates for 5/1 adjustable rate mortgages rose by nine basis points to an average of 2.51 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 fell to 0.10 percent on average.

Initial jobless claims rose to 332,000 first-time claims filed as compared to the previous week’s reading of 312,000 initial claims filed. Continuing claims fell with 2.67 million ongoing jobless claims filed as compared to the prior week’s reading of 2.85 million ongoing claims filed.

The University of Michigan released its preliminary Consumer Sentiment Index for September and reported a one-point increase in September’s index reading of 71.0. Analysts forecasted a reading of 72.0 based on the August reading of 70.3.

What’s Ahead

This week’s scheduled economic reporting includes readings from the National Association of Home Builders,

The Federal Reserve’s Open Market Committee will release its post-meeting statement and Fed Chair Jerome Powell will give a press conference. Commerce Department readings on housing starts and building permits will be released along with weekly readings on mortgage rates and jobless claims.