4/9/10 Mortgage Market Week-in-Review
April 12, 2010
What Did Interest Rates Do Last Week?
** based on Freddie Mac weekly average survey **
30-yr Fixed - Higher
Last Week: 5.21%
Previous Week: 5.08%
1yr Ago: 4.87%
15-yr Fixed - Higher
Last Week: 4.52%
Previous Week: 4.39%
1yr Ago: 4.54%
Jumbo Fixed (Average 30-yr Fixed)
Last Week: 5.50%
Previous Week: 5.50%
Highlight of Last Week's Major Economic Reports
Mortgage rates continue to rise as the recovery persists throughout the economy. And, with the economy regaining its strength, expect mortgage rates to continue going up - especially with the Fed no longer buying mortgage-backed securities to force rates down. The better and stronger the outlook is for the economy, the worse the prospects are for lower mortgage rates.
As such, with investors' outlook now turning rosier, they are more apt to dabble back in more high-risk investment options such as the stock market, which consequently reduces the demand for lower-yielding options like bonds. That's why when Uncle Sam tried to auction off Treasuries this past week, the paltry demand spurred a rise in interest rates, which was intended to attract more investors.
What to Look for This Week
Inflation - in the form of the Consumer Price Index - and Retail Sales will take center stage and could affect the direction of mortgage rates. Good news is that inflation is expected to remain benign, which should help mortgage rates. Retail Sales, on the other hand, could add upward pressure to rates, since they are expected to post some of the strongest numbers we've seen in two years.
Short-Term Rate Outlook
Higher
Stay Informed: What's in the News
"Report: Austin Home Prices Will Increase in Q1, 2011" from Austin Business Journal
http://austin.bizjournals.com/austin/stories/2010/04/05/daily50.html?ed=2010-04-08&ana=e_du_pub
"Austin Home Prices Fell 1.9% in February" from Austin Business Journal
Austin area home pries fell an average 1.9 percent from February to March, a relatively low shift compared with 25 of the nation's large metros, according to ZipRealty (Nasdaq: ZIPR).
The city also reported the lowest difference between actual selling price and listed amount, 4.15 percent, when compared to others in the report. The median list price in Austin was $245,000 in March, about $10,600 less than the median reported in February.
"Austin Rent Increase Among Highest in U.S." from Austin Business Journal
http://austin.bizjournals.com/austin/stories/2010/04/05/daily21.html?ed=2010-04-06&ana=e_du_pub
"Homebuyers Still Buying as Interest Rates Rise" from Austin Business Journal
http://austin.bizjournals.com/austin/stories/2010/04/05/daily36.html
"Americans Want to Own, Not Rent" from Texas A&M Real Estate Center
Safety and educational quality are among the reasons why 65 percent of Americans would rather own a home than rent one, according to Fannie Mae's national housing survey.
Of those Americans, 43 percent state that safety is a primary reason to buy, and 33 percent say they think schools are better in neighborhoods where most homes are owned by their residents.
However, buyers and renters are more cautious in today's economic climate than in the past, according to the survey, with 23 percent of renters reporting that they will buy a home but later than they once thought.
A full 70 percent of respondents believe buying a home is one of the safest investments available, but 60 percent think that it will be more difficult for them to secure a mortgage than it was for their parents.
** based on Freddie Mac weekly average survey **
30-yr Fixed - Higher
Last Week: 5.21%
Previous Week: 5.08%
1yr Ago: 4.87%
15-yr Fixed - Higher
Last Week: 4.52%
Previous Week: 4.39%
1yr Ago: 4.54%
Jumbo Fixed (Average 30-yr Fixed)
Last Week: 5.50%
Previous Week: 5.50%
Highlight of Last Week's Major Economic Reports
Mortgage rates continue to rise as the recovery persists throughout the economy. And, with the economy regaining its strength, expect mortgage rates to continue going up - especially with the Fed no longer buying mortgage-backed securities to force rates down. The better and stronger the outlook is for the economy, the worse the prospects are for lower mortgage rates.
As such, with investors' outlook now turning rosier, they are more apt to dabble back in more high-risk investment options such as the stock market, which consequently reduces the demand for lower-yielding options like bonds. That's why when Uncle Sam tried to auction off Treasuries this past week, the paltry demand spurred a rise in interest rates, which was intended to attract more investors.
What to Look for This Week
Inflation - in the form of the Consumer Price Index - and Retail Sales will take center stage and could affect the direction of mortgage rates. Good news is that inflation is expected to remain benign, which should help mortgage rates. Retail Sales, on the other hand, could add upward pressure to rates, since they are expected to post some of the strongest numbers we've seen in two years.
Short-Term Rate Outlook
Higher
Stay Informed: What's in the News
"Report: Austin Home Prices Will Increase in Q1, 2011" from Austin Business Journal
http://austin.bizjournals.com/austin/stories/2010/04/05/daily50.html?ed=2010-04-08&ana=e_du_pub
"Austin Home Prices Fell 1.9% in February" from Austin Business Journal
Austin area home pries fell an average 1.9 percent from February to March, a relatively low shift compared with 25 of the nation's large metros, according to ZipRealty (Nasdaq: ZIPR).
The city also reported the lowest difference between actual selling price and listed amount, 4.15 percent, when compared to others in the report. The median list price in Austin was $245,000 in March, about $10,600 less than the median reported in February.
"Austin Rent Increase Among Highest in U.S." from Austin Business Journal
http://austin.bizjournals.com/austin/stories/2010/04/05/daily21.html?ed=2010-04-06&ana=e_du_pub
"Homebuyers Still Buying as Interest Rates Rise" from Austin Business Journal
http://austin.bizjournals.com/austin/stories/2010/04/05/daily36.html
"Americans Want to Own, Not Rent" from Texas A&M Real Estate Center
Safety and educational quality are among the reasons why 65 percent of Americans would rather own a home than rent one, according to Fannie Mae's national housing survey.
Of those Americans, 43 percent state that safety is a primary reason to buy, and 33 percent say they think schools are better in neighborhoods where most homes are owned by their residents.
However, buyers and renters are more cautious in today's economic climate than in the past, according to the survey, with 23 percent of renters reporting that they will buy a home but later than they once thought.
A full 70 percent of respondents believe buying a home is one of the safest investments available, but 60 percent think that it will be more difficult for them to secure a mortgage than it was for their parents.