08
Sep
By First Rate Financial Group
Financial Reports

What’s Ahead For Mortgage Rates This Week – September 8, 2020

What's Ahead For Mortgage Rates This Week - September 8, 2020Last week’s scheduled economic news included readings on construction spending and labor sector reports on public and private sector jobs. The national unemployment rate was also reported. Weekly readings on mortgage rates and jobless claims were also published.

July Construction Spending Rises

Construction spending rose from June’s seasonally adjusted annual pace of  $1.363 billion to $1,365 billion in July. The U.S. Census Department reports construction spending and readings are subject to adjustment. Growth in construction spending is due to a demand for homes in less congested areas.COVID-19 is creating more demand for larger homes that accommodate working from home.

Mortgage Rates Mixed as Jobless Claims Fall

Mortgage rate activity was mixed last week amid incremental changes. Freddie Mac reported that rates for 30-year fixed-rate mortgages rose two basis points to 2.93 percent; the average rate for 15-year fixed-rate mortgages fell by four basis points to 2.42 percent. Rates for 5/1 adjustable rate mortgages rose by two basis points to 2.93 percent. Discount points averaged 0.80 percent for fixed-rate mortgages and 0.20 percent for 5/1 adjustable rate mortgages.

New and continuing jobless claims fell last week. 881,000 initial jobless claims were filed last week as compared to 1.01 million first-time claims filed the prior week.13.25 million continuing jobless claims were filed last week as compared to Ongoing jobless claims were lower last week with 13.250 million claims filed as compared to 14.490 million ongoing unemployment claims filed during the prior week. Falling jobless claims indicate strengthening economic conditions as businesses reopen and employers rehire former employees and add new employees.

Jobs Growth Reports Mixed, National Unemployment Rate Falls

ADP reported 428,000  private-sector jobs added in August as compared to July’s reading of 212,000 jobs added. The Commerce Department’s Non-Farm Payrolls report showed 1.37 public and private-sector jobs.added in August as compared to 1.73 million jobs added in July. Analysts said that looming layoffs in airlines and travel sectors could slow job growth. The national unemployment rate fell to 8.40 percent in August from July’s reading of 10.20 percent.

 Based on these readings, the economy is rebounding from the impacts of COVID-19, but analysts were cautious as the three-day Labor Day weekend approached. COVID-19 cases rose after the Memorial Day and Fourth of July holidays. Increasing cases of COVID-19 could cause state and local governments to impose restrictions aimed at reducing the spread of the coronavirus. 

What’s Ahead

This week’s scheduled economic reports include reports on inflation and weekly readings on mortgage rates and jobless claims.

24
Aug
By First Rate Financial Group
Financial Reports

What’s Ahead For Mortgage Rates This Week – August 24, 2020

What's Ahead For Mortgage Rates This Week - August 24, 2020Last week’s economic news included readings from Case-Shiller on home prices, the National Association of Home Builders Housing Market Indices, and sales of previously-owned homes. Readings on housing starts and building permits issued were released. Weekly reports on mortgage rates, new and continuing jobless claims were also published.

NAHB: Home Builder Confidence Rises in August

The National Association of Home Builders reported that builder confidence in housing market conditions rose six points to an index reading of 78.in August. The expected reading of 73 was based on July’s reading of 72. Homebuilder confidence was based on sharp demand for homes as city dwellers sought larger homes in less dense housing metro areas.

Ongoing shortages of pre-owned homes for sale boosted builder outlook as would-be buyers turned to new homes as supplies of pre-owned homes remained low.

The National Association of Realtors® reported higher numbers of previously owned homes sold in July at a seasonally adjusted annual pace of 5.86 million sales. 5.50 million sales of previously owned homes were expected based on June’s seasonally adjusted annual pace of 4.70 million sales.

Rising home sales could indicate increasing numbers of available homes, rising confidence in the economy, and sellers putting their homes on the market for reasons including buying bigger homes or relocation for less congested living conditions.

Commerce Department Reports Rising Rates of Housing Starts and Building Permits Issued

The Commerce Department reported a jump in U.S. housing starts in July with a seasonally adjusted annual rate of 1.496 million starts as compared to an expected pace of 1.330 million housing starts and an annual pace of  1.258 million housing starts reported in June.

Mortgage Rates Rise; Jobless Claims Mixed

Freddie Mac reported higher mortgage rates last week; the average rate for 30-year fixed-rate mortgages rose three basis points to 2.99 percent. Rates for 15-year fixed-rate mortgages averaged 2.54 percent and were eight basis points higher. Interest rates for 5/1 adjustable rate mortgages averaged one basis point higher at 2.91 percent. Discount points averaged 0.80 percent for 30-year fixed-rate mortgages, 0.70 percent for 15-year fixed-rate mortgages. Discount points for 5/1 adjustable rate mortgages averaged 0.30 percent.

Initial jobless claims reported by states rose to 1.11 million new claims filed last week and surpassed the expected a reading of 910,000 new claims filed based on the prior week’s reading of  971,000 initial jobless claims filed. Continuing jobless claims fell to 14.80 million ongoing claims from the prior week’s reading of 15.50 million continuing claims.

What’s Ahead

This week’s scheduled economic news includes readings from Case-Shiller Home Price Indices, reports on new and pending home sales, and inflation. Weekly reports on mortgage rates and jobless claims will also be released.

13
Jul
By First Rate Financial Group
Financial Reports

What’s Ahead For Mortgage Rates This Week – July 13, 2020

What's Ahead For Mortgage Rates This Week - July 13, 2020Last week’s scheduled economic news included readings on consumer credit, job openings, jobless claims, and mortgage rates.

Consumer Borrowing Declined at Slower Pace in May

According to Federal Reserve data, consumer borrowing fell at a slower annual pace of -5.30 percent in May as compared to April’s reading of -20 percent. Non-revolving consumer credit, which includes vehicle and student loans, increased by 2.30 percent in May. The Federal Reserve does not report on real estate loans.

Federal assistance programs including the first round of stimulus checks, additional unemployment payments and support for businesses contributed to better readings for the economy in May, but last week’s rising coronavirus cases may cause all or part of economic gains to be lost as local governments reverse decisions to reopen businesses and local government services.

Job Openings Rise  in May as Weekly Jobless Claims Fall

The Bureau of Labor Statistics reported 5.40 million job openings in May as compared to April’s 5.00 million job openings. Rising job openings coincided with reopening business and government services as state and local authorities eased stay-at-home requirements and began easing restrictions on economic activity.

Weekly jobless claims were also lower than for the preceding week. 1.31 million initial jobless claims were filed last week as compared to the prior week’s reading of 1.41 million first-time claims filed. Ongoing jobless claims fell to 18.10 million claims from the prior week’s reading of 18.80 million continuing jobless claims. Jobless claims remained much higher than pre-pandemic readings.

Mortgage Rates Drop to Record Lows

Freddie Mac reported the lowest recorded average mortgage rates as rates for fixed-rate mortgages dropped by four basis points to 3.03 percent for 30-year fixed-rate mortgages and fell by five basis points to 2.51 percent for 15-year fixed-rate mortgages. The average rate for 5/1 adjustable rate mortgages rose two basis points to 3.02 percent; discount points averaged 0.80 percent for fixed-rate mortgages and 0.30 percent for 5/1 adjustable rate mortgages.

The U.S. Senate is expected to work on its version of the next Coronavirus relief package next week; it should be completed by the end of July or in early August.

What’s Ahead

This week’s scheduled economic news includes reports on housing markets, housing starts, and consumer sentiment. Weekly readings on mortgage rates and jobless claims will also be released.