Market Minute - Economy and Housing News - Erin Carvelli

  • Unemployment hit a 53-year low last month, with over 500k new jobs created. The labor market remains strong despite the Fed rate hikes.
  • Mortgage rates rose as markets began anticipating 2 additional Fed rate hikes that would raise the policy rate to at least 5%.
  • After constricting in December, the ISM service sector index came in higher than expected in January, a hopeful economic sign.

  • Although still lower than a year ago, purchase mortgage applications rose 3% for the week. Refi apps were up 18%.
  • Black Knight reports 57% of recent borrowers accessed lower rates with permanent rate buydowns. Nearly 25% paid 2 or more points.
  • Housing inventory fell by 8,664 units last week. Continuing inventory declines can help mitigate falling home prices. 

Market Minute Report - Mortgage News

Borrowers typically know about 30- and 15-year fixed rate mortgage loans, yet there are dozens of different loan types beyond just those. 

Mortgage planning, like financial planning serves many needs. Our mission is always to tailor the right mortgage program or strategy to best suit the overall goals of our clients.

Do you need the lowest possible housing payment to maximize other investments?

  • A 30-year fixed rate loan will probably help.

Do you need to leverage potentially tax-advantaged funds to pay for major home improvement?

Are you looking for a way to avoid private mortgage insurance or jumbo loan rates?

  • A small second mortgage closed simultaneously with the first may be the solution.

Customized Loan Solutions That Meet Your Needs

Greenway Mortgage offers a variety of other loan options to suit the needs of each and every client whether they are looking to buy their first home, move up, refinance, or invest. Some loan options include VA, USDA, FHA, Conventional, Down Payment Assistance, Reverse, Refinance, Renovation, Jumbo, and more. Information on these can be found by visiting our Loan Product page here.

With personalized attention and unmatched expertise, Greenway Mortgage can help customers find the right financing option. Our technology facilitates a low stress, streamlined and paperless workflow that expedites the loan process in a low-pressure sales environment. Our dedicated and knowledgeable loan consultants are available throughout the process.

Contact us today to see what loan option best suits your specific goals.

Contact Erin Carvelli

The Fed announced another hike.

As expected, the Fed raised policy rates by 0.25% at their February meeting. This is the smallest increase of the eight made in the last 11 months.

More "interesting" is the Fed's signal regarding future increases.

The Fed statement released after the meeting hinted that ongoing rate increases are anticipated before inflation is brought to the Fed's target of 2.0%. Investors were hoping the Fed would back off of that sentiment.

Please Note: Mortgage rates are impacted by market forces beyond Fed actions and will not necessarily change at the same pace as the Fed's moves. They often shift before the Fed acts, in anticipation of their changes.

Should the Fed's news change your home financing plans?

If this is your time to purchase a home or access cash from equity, don't let rates stop you.

Let's find a way to work within the framework of the current environment. Options like hybrid ARMs, buydowns and HELOCS can help.

Background on the Fed:

  • The Federal Reserve Board (the Fed) controls the federal funds rate and discount rate, which are charges for overnight loans from bank to bank or from the Fed to member banks.
  • The rate was lowered to near zero in March 2020 in response to the pandemic. These historic measures are now being reversed.

This is the eighth increase since March 2022.

Bottom Line:

Don't let interest rates hold you back from making a move or accessing cash. We're still closing loans every day!

Market Minute - Economy and Housing News - Erin Carvelli

  • Despite recession fears, the economy grew at a pace of 2.9% in the 4th quarter, more than the expected 2.6%.
  • Business activity contracted for the 7th straight month in January. The downturn moderated across both the manufacturing and services sectors.
  • Jobless claims declined again last week, this time to 186K. The drop signals labor market strength despite Fed rate hikes and talk of recession.

  • NAR reports the median home sales price in 2022 was $386,300, up 10.2% from 2021 and the highest on record.
  • Existing home sales in December fell for the 11th straight month and hit the slowest pace since 2010. Improvements are expected in 2023.
  • However, new home sales rose 2.3% in December. The 3rd straight monthly increase shows homebuyers are still shopping. 


Market Minute Report - Mortgage News

Market Minute - Economy and Housing News - Erin Carvelli

  • A recent Fed survey showed the economy held steady in early January. Some regions experienced modest declines in activity.
  • Prices for wholesale goods and services fell sharply in December, providing another sign that inflation is beginning to ease, though still high.
  • December's retail sales fell by the most in a year, and business equipment production slumped, indicating the economy may be losing momentum.

  • Homebuilder sentiment posted an unexpected gain in January, rising for the first time in 12 months.
  • Single-family homebuilding rebounded with an 11.3% increase in December. Total new home construction fell for a 4th straight month.
  • Mortgage application volume jumped nearly 28% for the week, with purchase apps rising 25% over the previous week. 


Market Minute Report - Mortgage News

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