What’s Ahead For Mortgage Rates This Week – December 14, 2020

What's Ahead For Mortgage Rates This Week - December 14, 2020Last week’s scheduled economic reporting included readings on inflation and consumer sentiment. Weekly readings on mortgage rates and jobless claims were also released.

Inflation Rate Rises in November

Inflation rose by 0.20 percent in November according to the federal government, but this reading fell short of the Federal Reserve’s goal of achieving 2.00 percent inflation annually. November’s year-over-year inflation rate was 1.20 percent. October’s inflation reading was flat and analysts expected inflation to grow by 0.10 percent in November.

Core inflation, which excludes volatile food and fuel sectors, showed readings identical to the Consumer Price Index reading. November’s Core Consumer Price Index was impacted by lower food and fuel costs.

Supreme Court Hears Arguments in Shareholder Suit over Fannie Mae and Freddie Mac

Fannie Mae and Freddie Mac were put under the oversight of the Federal Housing Finance Agency after the Great Recession and resulting mortgage crisis. The Supreme Court heard oral arguments regarding shareholder assertions that oversight of Fannie Mae and Freddie Mac is unconstitutional.

Mortgage Rates Mixed as Jobless Claims Rise

Freddie Mac reported no change in average fixed mortgage rates last week. Rates for 30-year fixed-rate mortgages averaged 2.71 percent; the average rate for 15-year fixed-rate mortgages was also unchanged at 2.26 percent.  Rates for 5/1 adjustable rate mortgages averaged 2.79 percent and were seven basis points lower than in the prior week. 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.

First-time jobless claims were higher last week with 853,000 new claims filed as compared to 716,000 first-time claims filed the prior week. Analysts expected 720,000 first-time claims last week. Ongoing jobless claims also rose with 5.76 million claims filed as compared to the prior week’s reading of 5.53 million continuing claims filed. Increasing numbers of coronavirus cases caused higher than expected layoffs last week.

The University of Michigan’s Consumer Sentiment Index rose in December to an index reading of 81.4. Analysts expected December’s reading to decrease to 75.5 based on November’s index reading of 76.9. As winter progresses and Covid-19 cases continue to rise, consumer sentiment toward economic conditions will likely decline.

What’s Ahead

This week’s scheduled economic readings include reports from the National Association of Home Builders on housing market conditions; the Commerce Department will release reports on housing starts and building permits issued. The Federal Reserve will issue its Federal Open Market Committee Statement and Fed Chair Jerome Powell is slated to give a post-meeting press conference.

What’s Ahead For Mortgage Rates This Week – November 23, 2020

What's Ahead For Mortgage Rates This Week - November 23, 2020Last week’s economic reporting included readings on housing market conditions, sales of previously owned homes, and housing starts and building permits issued. Weekly reports on mortgage rates and jobless claims were also released.

NAHB: Homebuilder Confidence Hits Record High in November

The National Association of Home Builders reported a fourth consecutive record high for builder confidence as November’s index reading of 90 exceeded October’s reading of 80. Any reading over 50 indicates that most home builders are confident about housing markets.

Component readings for the Housing Market Index also rose. Builder confidence in current market conditions rose six points to 96. Builder confidence in housing market conditions within the next six months rose one point to 89 and builder confidence in buyer traffic in new housing developments increased by three points to an index reading of 77. Readings of 50 or more for buyer traffic were rare until recent months. Factors driving builder confidence include high demand for homes and record low mortgage rates. High demand for single-family homes is rising due to relocation to suburbs and increased demand for larger homes.

Housing Starts Increase as Building Permits Issued Hold Steady

Commerce Department readings for October show that housing starts rose to 1.530 million starts on a seasonally-adjusted annual basis. Analysts expected a pace of 1.490 million housing starts based on 1.459 million starts reported in September. 1.545 million building permits were issued in October, which matched September’s reading.

Mortgage Rates Hit Another Record Low; Jobless Claims Data Mixed

Freddie Mac reported new record low mortgage rates for the fourth consecutive week. Rates for 30-year fixed-rate mortgages averaged 12 basis points lower at 2.72 percent; rates for 15-year fixed-rate mortgages averaged 2.28  percent and were six basis points lower. Rates for 5/1 adjustable rate mortgages dropped by 26 basis points to 2.85 percent on average. 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 0.30 percent.

First-time jobless claims rose to 742,000 claims filed; analysts expected 710,000 claims filed based on the prior week’s reading of 711,000 initial jobless claims filed. Ongoing jobless claims fell to 6.37 million claims filed as compared to 680,000 continuing jobless claims filed in the prior week.

October sales of previously-owned homes rose to 6.85 million sales on a seasonally-adjusted annual basis as compared to September’s reading of 6.80 million sales of previously-owned homes.

What’s Ahead

This week’s scheduled economic reporting includes readings from Case-Shiller Indices on home prices; new home sales will also be released along with the University of Michigan’s report on consumer sentiment. Weekly readings on mortgage rates and jobless claims will also be released.

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

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.

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

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 – August 31, 2020

What's Ahead For Mortgage Rates This Week - August 31, 2020Last week’s economic news included readings from Case-Shiller Home Price Indices, along with data on new and pending home sales. Weekly readings on mortgage rates and new and continuing jobless claims were also published.

Case-Shiller: Home Price GrowthHolds Steady in June

National home prices grew at a seasonally-adjusted annual pace of 4.30 percent in June, which was unchanged from May’s year-over-year growth rate for home prices. The 20-City Home Price Index rose by 3.50 percent year-over-year in June.  

Phoenix, Arizona reported the leading year-over-year home price growth rate of 9.00 percent. Seattle, Washington held second place with a year-over-year home price growth rate of 6.50 percent. Home prices in Tampa, Florida grew at a year-over-year pace of 5.90 percent.   

Home price growth rates rose in five of 19 cities reported in the 20-City Index; the Wayne County Michigan metro area did not report for June’s 20-City Home Price Index. 

New Home Sales Rise as Pending Home Sales Dip in July

Sales of new homes rose for the third consecutive month in July according to the U.S. Census Bureau. July’s reading of 901,000 new homes sold on a seasonally adjusted annual basis was the highest pace of sales since 2006. Sales of new homes were 36 percent higher year-over-year. Slim inventories of pre-owned homes for sale and low mortgage rates boosted new home sales, but analysts said that builders also face headwinds including higher materials costs and affordability.

Pending home sales dropped in July from June’s year-over-year reading of 15.80 percent to July’s reading of 5.80 percent. Ongoing concerns over COVID-19, high unemployment rates and, concerns over jobs have caused would-be-homebuyers to delay their home purchase plans.

Mortgage Rates, Jobless Claims Fall

Freddie Mac reported lower rates for fixed-rate mortgages last week with the average rate for 30-year fixed-rate mortgages falling by eight basis points to 2.91 percent. The average rate for 15-year fixed-rate mortgages also fell by eight basis points to 2.46 percent. Rates for 5/1 adjustable rate mortgages averaged 2.91 percent and were unchanged from the prior week.

New jobless claims fell to 1.01 million claims filed from the prior week’s reading of 1.10 million initial claims filed. Continuing jobless claims were also lower with 14.54 million continuing claims filed as compared to the previous week’s reading of 14.76 million continuing jobless claims filed.

What’s Ahead

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