Blog


  • Stocks continued to sell off in anticipation of an economic slowdown expected with future Fed actions, helping mortgage rates this week.
  • Retail spending increased 0.9% in April, despite inflation. This 4th straight monthly increase signals the economy is still strong.
  • Unemployment claims rose last week to 218K, the highest since January. However, continuing claims fell to the lowest level since 1969.

  • Existing home sales dropped in April to the lowest level since the start of the pandemic due to the ongoing lack of inventory.
  • Homebuilder sentiment dipped to a 2-year low in May, as declining demand and rising costs raised concerns. It is expected to bounce back.
  • Last week’s purchase mortgage applications fell 12% week to week and 15% year over year.

 


 

  • Inflation expectations for the next year fell to a median 6.3% in April, a 0.3% decrease from the record high the previous month.
  • However, producer prices rose 11% in April, signaling continuing elevated consumer inflation in the near future.
  • Last week's jobs data showed slightly more jobs than expected added in April in an increasingly tight labor market and despite surging inflation.

  • Purchase mortgage applications rose 5% over the previous week. Although apps were down 8% from a year ago, that number is shrinking.
  • Apps for adjustable rate mortgages, which often have a lower starting rate than 30 yr fixed, surged to a 14-yr high, comprising 11% of apps.
  • Lumber prices are falling, down 30% and reaching their lowest level for the year. Prices are still above historical levels but could continue to drop.

 

 

 

 

  • The Fed raised policy rates 0.5% this week. The move will increase short term rates like car loans, some home equity loans, and credit card rates.
  • The Fed rate increase does not directly increase mortgage rates though. Mortgage rates moved higher already in anticipation of Fed action.
  • Concerns that intense labor demand could spark further wage increases has investors worried the Fed won't be able to curb inflation.

  • A recent Gallup survey showed just 30% of adults think now is a good time to buy a home, the first time it has been below 50% since 1978.
  • Total mortgage applications were up 2.5% last week. Though purchase applications were down 11% from last year, they were up 4% on the week.
  • 71% of homeowners with upcoming house projects expect to proceed despite anticipated higher costs, delays and materials shortages.


  • Factory orders for durable goods rose in March, pointing to sustained investment in business equipment that is helping drive economic growth.
  • GDP growth slowed to a 1.4% pace in the 1st qtr, an unexpected change for an economy coming off its best performance since 1984.
  • However, personal consumption, the biggest part of the economy, rose an annualized 2.7% in the 1st qtr, compared with 2.5% at the end of 2021.

  • Despite a drop in sales, new home demand remains strong. The number of new homes already sold and not yet started hit the highest level in a year.
  • Rising rates and prices are cooling buyer competition. 65% of homes received a competing bid in March, down 1.7% from February.
  • Pending home sales fell 4.1% in February from January. Although some blame rising mortgage rates, the more likely cause is lack of inventory.
 


  • Fed members continue to signal they will take aggressive action to curb inflation, including hiking policy rates at their May meeting.
  • Claims for jobless benefits are at their lowest levels since the 1960s, highlighting a job market where demand for labor exceeds supply.
  • This week’s Fed survey, known as the Beige Book, found little evidence inflation will turn appreciably lower, not a good sign for rates.

 

  • Inflation and higher mortgage rates are taking their toll on the nation’s homebuilders. Builder confidence fell for the 4th straight month in April.
  • Housing starts rose unexpectedly in March, increasing 0.3%. However, starts for single-family housing tumbled amid rising mortgage rates.
  • The median price of an existing home sold in March was $375,300, a 15% year-over-year increase and the highest median price ever recorded.

 


Showing results 1 - 5 of 290