7/2/10 Mortgage Market Week-in-Review
July 05, 2010
What Did Interest Rates Do Last Week?
** based on Freddie Mac weekly average survey **
30-yr Fixed - Lower
Last Week: 4.58%
Previous Week: 4.69%
1yr Ago: 5.32%
15-yr Fixed - Lower
Last Week: 4.04%
Previous Week: 4.13%
1yr Ago: 4.4.77%
Jumbo Fixed (Average 30-yr Fixed)
Last Week: 5.50%
Previous Week: 5.50%
Highlight of Last Week's Major Economic Reports
Employment remains in short supply, as the economy lost 125K jobs in June. Surprisingly, the bulk of the job losses came from government layoffs, which previously accounted for job increases stemming from Census work. The unemployment rate dropped to 9.5%, which isn't necessarily a good sign, since this likely just means that thousands and thousands of people stopped looking for work.
This ongoing weakness in the labor market will contribute to keeping rates at exceptionally low levels, but this incentive may be for naught, as fewer people will be looking to spend money on goods/services and housing if they can't find a job.
What to Look for This Week
Not much going on during this holiday-shortened week, so look for stock and bond market activity to drive the direction of mortgage rates. Unless overly positive (or dire) news comes out unexpectedly, there's no major catalyst to push mortgage rates noticeably higher or lower.
Short-Term Rate Outlook
Stable
Stay Informed: What's in the News
"Texas Leads Nation for Job Growth in May" from Austin Business Journal
http://austin.bizjournals.com/austin/stories/2010/06/28/daily49.html?surround=lfn
"Sales of Foreclosed Homes Drop in Austin" from Austin Business Journal
http://www.bizjournals.com/austin/stories/2010/06/28/daily24.html?ana=e_du_pap
"Consumer Confidence on the Rise" from Austin Business Journal
Americans are feeling better about the economy, according to the newly released Reuters/University of Michigan consumer sentiment index. The index rose to 76 in June from 73.6 in May, putting it at the highest level since January 2008.
"Austin Home Starts Increase 32% from Q1" from Austin Business Journal
http://www.bizjournals.com/austin/stories/2010/06/28/daily57.html?ana=e_du_pap
"Largest Solar Farm in Texas Planned for Pflugerville" from Austin Business Journal
http://www.bizjournals.com/austin/stories/2010/06/28/daily60.html?ana=e_du_pap
"Beaten-Down Condos: 'Deals of Lifetime'" from CNNMoney.com
For the first time in years there is a glimmer of hope in the condo market. After falling 20% nationwide and 60% or more in the hardest-hit areas, median condo prices remained flat nationally in the first quarter vs. a year earlier. And sales in March were up 40% from the previous year, hinting that prices might be heading back up soon too.
"Survey: 70% Think Economy Will Not Improve in '10" from Austin Business Journal
http://austin.bizjournals.com/austin/stories/2010/06/28/daily31.html?surround=lfn
"Fannie Mae Announces Changes to Appraisal Process" from American Banker
Fannie Mae is turning up the heat on appraisals. The government-sponsored enterprise announced several changes late Wednesday aimed at improving the quality of appraisals, including a requirement that lenders cannot use inexperienced appraisers. Fannie also wants lenders to explain any changes made to the appraised value of a property, and provided further guidance on how to determine comparable sales, a process that has become more complicated now that the market is inundated with distressed properties. And because there have been reports of borrowers trashing homes, lowering the value of those that are in foreclosure, Fannie is now requiring appraisals to include interior photos.
** based on Freddie Mac weekly average survey **
30-yr Fixed - Lower
Last Week: 4.58%
Previous Week: 4.69%
1yr Ago: 5.32%
15-yr Fixed - Lower
Last Week: 4.04%
Previous Week: 4.13%
1yr Ago: 4.4.77%
Jumbo Fixed (Average 30-yr Fixed)
Last Week: 5.50%
Previous Week: 5.50%
Highlight of Last Week's Major Economic Reports
Employment remains in short supply, as the economy lost 125K jobs in June. Surprisingly, the bulk of the job losses came from government layoffs, which previously accounted for job increases stemming from Census work. The unemployment rate dropped to 9.5%, which isn't necessarily a good sign, since this likely just means that thousands and thousands of people stopped looking for work.
This ongoing weakness in the labor market will contribute to keeping rates at exceptionally low levels, but this incentive may be for naught, as fewer people will be looking to spend money on goods/services and housing if they can't find a job.
What to Look for This Week
Not much going on during this holiday-shortened week, so look for stock and bond market activity to drive the direction of mortgage rates. Unless overly positive (or dire) news comes out unexpectedly, there's no major catalyst to push mortgage rates noticeably higher or lower.
Short-Term Rate Outlook
Stable
Stay Informed: What's in the News
"Texas Leads Nation for Job Growth in May" from Austin Business Journal
http://austin.bizjournals.com/austin/stories/2010/06/28/daily49.html?surround=lfn
"Sales of Foreclosed Homes Drop in Austin" from Austin Business Journal
http://www.bizjournals.com/austin/stories/2010/06/28/daily24.html?ana=e_du_pap
"Consumer Confidence on the Rise" from Austin Business Journal
Americans are feeling better about the economy, according to the newly released Reuters/University of Michigan consumer sentiment index. The index rose to 76 in June from 73.6 in May, putting it at the highest level since January 2008.
"Austin Home Starts Increase 32% from Q1" from Austin Business Journal
http://www.bizjournals.com/austin/stories/2010/06/28/daily57.html?ana=e_du_pap
"Largest Solar Farm in Texas Planned for Pflugerville" from Austin Business Journal
http://www.bizjournals.com/austin/stories/2010/06/28/daily60.html?ana=e_du_pap
"Beaten-Down Condos: 'Deals of Lifetime'" from CNNMoney.com
For the first time in years there is a glimmer of hope in the condo market. After falling 20% nationwide and 60% or more in the hardest-hit areas, median condo prices remained flat nationally in the first quarter vs. a year earlier. And sales in March were up 40% from the previous year, hinting that prices might be heading back up soon too.
"Survey: 70% Think Economy Will Not Improve in '10" from Austin Business Journal
http://austin.bizjournals.com/austin/stories/2010/06/28/daily31.html?surround=lfn
"Fannie Mae Announces Changes to Appraisal Process" from American Banker
Fannie Mae is turning up the heat on appraisals. The government-sponsored enterprise announced several changes late Wednesday aimed at improving the quality of appraisals, including a requirement that lenders cannot use inexperienced appraisers. Fannie also wants lenders to explain any changes made to the appraised value of a property, and provided further guidance on how to determine comparable sales, a process that has become more complicated now that the market is inundated with distressed properties. And because there have been reports of borrowers trashing homes, lowering the value of those that are in foreclosure, Fannie is now requiring appraisals to include interior photos.