14
Mar
By First Rate Financial Group
Financial Reports

What’s Ahead For Mortgage Rates This Week – March 14, 2022

What's Ahead For Mortgage Rates This Week - March 14, 2022Last week’s economic reporting included month-to-month and year-over-year readings on inflation. The University of Michigan released its monthly consumer sentiment index; weekly readings on mortgage rates and jobless claims were also published.

Inflation Reports: No Good News for Consumers

The war in Ukraine increased inflation rates in the U.S in February as costs for fuel, food and housing continued to rise. The federal government reported that month-to-month inflation rose by 0.80 percent in February; analysts expected a month-to-month increase of 0.70 percent as compared to January’s reading of 0.60 percent.

Core inflation, which excludes volatile food and energy sectors, rose by 0.50 percent in February and matched expectations. January’s month-to-month rate for core inflation was 0.60 percent and was the highest reading for month-to-month core inflation since 1981. Analysts reported that high inflation was impacting low and moderate-income Americans more as rapidly rising costs for housing, food, and fuel rose faster than wages for most.

Year-over-year inflation rose by 7.90 percent in February as compared to January’s reading of 7.50 percent. Core inflation rose at a year-over-year pace of 6.40 percent in February and surpassed January’s core reading of 6.00 percent. Core inflation readings exclude volatile food and fuel sectors.

Mortgage Rates, Jobless Claims Rise

Freddie Mac reported higher average mortgage rates last week as the rate for 30-year fixed-rate mortgages increased by nine basis points to 3.85 percent. Rates for 15-year fixed-rate mortgages averaged 3.09 percent and were eight basis points higher than in the previous week. The average rate for 5/1 adjustable rate mortgages was six basis points higher at 2.97 percent. Discount points averaged 0.80 percent for fixed-rate mortgages and 0.30  percent for 5/1 adjustable rate mortgages.

Last week’s initial jobless claims rose to 217,000 new claims filed as compared to 216,000 first-time claims filed in the previous week. Analysts expected initial jobless claims filed last week to match the previous week’s reading of 216,000 first-time claims filed.  Continuing jobless claims rose to 1.49 million claims filed as compared to the prior week’s reading of 1.47 million ongoing claims filed.

The University of Michigan’s Consumer Sentiment Survey reflected consumer concerns over inflation and the potential economic impacts of the Ukraine war. The March index reading of 59.7 was lower than February’s reading of 62.8 and the expected index reading of 62.0. Index readings over 50 indicate that most consumers are confident about economic conditions.

What’s Ahead

This week’s scheduled economic news includes readings on U.S housing markets, the Federal Reserve’s statement on interest rates, and the Federal Reserve chairman’s press conference. Data on building permits, housing starts, and sales of previously-owned homes will also be released. Weekly reports on mortgage rates and jobless claims will also be published.

22
Feb
By First Rate Financial Group
Financial Reports

What’s Ahead For Mortgage Rates This Week – February 22, 2022

What's Ahead For Mortgage Rates This Week - February 22, 2022

Last week’s economic reporting included readings from the National Association of Home Builders on housing markets, reports on sales of previously owned homes, housing starts, and building permits issued. Weekly readings on mortgage rates and jobless claims were also released.

NAHB: Rising Materials Costs, Supply Chain Problems Weigh on Builders

The National Association of Home Builders’ February housing market index reading was 82 and one point lower than in January. This was the second consecutive month that builder confidence dropped by one point. Homebuilder confidence in housing market conditions remained relatively high as any index reading over 50 indicates that most builders are confident about market conditions.

Short supplies of available homes and high demand combined to hold builder confidence steady, but growing concerns over rising materials costs, delivery delays, and labor shortages put downward pressure on builder confidence. NAHB chair Jerry Konter wrote, “Many builders are waiting months to receive cabinets, garage doors, countertops, and appliances. These delivery delays are raising construction costs and pricing prospective buyers out of the market.” Rising mortgage rates coupled with rising home prices were regarded by homebuilders as threats to affordability for moderate-income and first-time home buyers. 

Building Permits Increase as Housing Starts Decline

The Commerce Department reported that building permits issued exceeded expectations and the prior month’s reading. 1.90 million building permits were issued on a seasonally-adjusted annual basis in January as compared to the expected reading of 1.75 million permits issued and December’s reading of 1.89 million permits issued.

January housing starts decreased to 1.64 million starts on a seasonally-adjusted annual basis from December’s reading of 1.71 million starts and the expected reading of 1.69 million housing starts. Economists expect a slowdown in home building as shortages of available homes, rising home prices, and mortgage rates continue to impact affordability.

January sales of previously-owned homes rose to 6.50 million sales on a seasonally-adjusted annual basis from December’s reading of 6.09 million sales. Analysts predicted a reading of 6.10 million sales.

Mortgage Rates Rise, Jobless Claims Mixed

Freddie Mac reported higher average mortgage rates last week as the rate for 30-year fixed-rate mortgages rose 23 basis points to 3.92 percent. Rates for 15-year fixed-rate mortgages averaged 3.15 percent and were 22 basis points higher. The average rate for 5/1 adjustable rate mortgages rose by 18 basis points to 2.98 percent. Discount points averaged 0.80 percent for fixed-rate mortgages and 0.30 percent for 5/1 adjustable rate mortgages.

First-time jobless claims rose to 248,000 claims filed; analysts expected 218,000 new claims to be filed based on 225,000 initial jobless claims filed in the prior week. 1.59 million ongoing jobless claims were filed last week as compared to the previous week’s reading of 1.62 million continuing jobless claims filed.

What’s Ahead

This week’s scheduled economic reporting includes readings from S&P Case-Shiller Home Price Indices, the Federal Housing Finance Agency Home Price Index, data on new home sales, and the University of Michigan’s Consumer Sentiment Index.

14
Feb
By First Rate Financial Group
Financial Reports

What’s Ahead For Mortgage Rates This Week – February 14, 2022

What's Ahead For Mortgage Rates This Week - February 14, 2022Last week’s economic reporting included readings on inflation and the University of Michigan’s preliminary February reporting on consumer sentiment. Weekly readings on mortgage rates and jobless claims were also released.

Inflation Rises as Fed Considers Raising Key Rate

The government’s Consumer Price Index for January reported that month-to-month inflation rose by 0.60 percent as compared to an expected increase of 0.40 percent which was based on December’s month-to-month increase of 0.50 percent.  Year-over-year inflation rose to a rate of 7.50 percent, which was the highest inflation rate in 40 years. Core inflation, which excludes volatile food and energy sectors, also rose 0.60 percent in January from December’s reading of 5.50 percent.

Analysts said that the Federal Reserve will likely raise its key federal funds rate range to help slow inflation, but drastic dips in the inflation rate aren’t expected. While the Fed predicted inflation to ease in a statement made last December, inflation has only increased. The Fed’s strategy of raising interest rates would ease high consumer demand and help slow rapidly rising prices for housing, goods, and services.

Mortgage Rates Rise, Jobless Claims and Consumer Sentiment Fall

Freddie Mac reported higher mortgage rates last week as the average rate for 30-year fixed-rate mortgages rose by 14 basis points to 3.69 percent. The average rate for 15-year fixed-rate mortgages rose by 16 basis points to 2.93 percent. Rates for 5/1 adjustable-rate mortgages averaged 2.80 percent and nine basis points higher. Discount points averaged 0.80 percent for fixed-rate mortgages and 0.30 percent for  5/1 adjustable-rate mortgages.

223,000 new jobless claims were filed last week as compared to the prior week’s reading of 239,000 first-time claims filed. No information for continuing jobless claims was released last week.

The University of Michigan reported a preliminary index reading of 61.7 for January’s Consumer Sentiment Index. This was the lowest consumer sentiment reading in ten years and was attributed to consumer concerns over rising inflation.

What’s Ahead

This week’s scheduled economic news includes readings from the National Association of Home Builders on housing market conditions, Commerce Department readings on building permits issued, and housing starts. Data on sales of pre-owned homes will be released along with weekly reporting on mortgage rates and jobless claims.