New Home Prices and Sales Jump

Realtor
Brenda Borum
Realtor
Keller Williams WVC
Phone: 805-844-6183
Lic: CalBRE# 00698082
Email: brenda@brendaborum.com
Website: http://www.BrendaBorum.com
Certified Mortgage Planner
Bob Brenner
Certified Mortgage Planner
Synergy One Lending
NMLS#: 240029
Phone: 805-465-8937
Email: bobbrennerloans@gmail.com
Website: http://www.bobbrennerloans.com

 


 

Rates At a Glance

Mortgage Rates
Currently Trending
7 Day Mortgage
Rate Forecast
This Week’s
Potential Volatility
Neutral Neutral Average
(by Sigma Research)

 


Realtor Report

New Home Prices and Sales JumpSales of newly built, single-family homes in May rose 2.9 percent to a seasonally adjusted annual rate of 610,000 units after an upwardly revised April reading, according to newly released data by the U.S. Department of Housing and Urban Development and the U.S. Census Bureau.So, that is the good news. The bad news? The median sales price jumped 11.5% to $345,800. Supply is still very tight with only 5.3 months of inventory at the current sales pace which means steady upward pressure on future prices.“This month’s report is in line with our forecast, and consistent with solid builder confidence readings,” said NAHB Chief Economist Robert Dietz. “With more consumers entering the market, further job growth and tight existing home inventory, the new home sector should continue to expand.”Regionally, new home sales increased 13.3 percent in the West and 6.2 percent in the South. Sales fell 10.8 percent in the Northeast and 25.7 percent in the Midwest.

 


This Week’s Mortgage Rate Summary

How Rates Move:Conventional and Government (FHA and VA) lenders set their rates based on the pricing of Mortgage-Backed Securities (MBS) which are traded in real time, all day in the bond market.  This means rates or loan fees (mortgage pricing) moves throughout the day, being affected by a variety of economic or political events.  When MBS pricing goes up, mortgage rates or pricing generally goes down.  When they fall, mortgage pricing goes up.  Tracking these securities real-time is critical.  For more information about the rate market, contact me directly.  I’m among few mortgage professionals who have access to live trading screens during market hours.Rates Currently Trending: NeutralMortgage rates are trending slightly lower so far today.  Last week the MBS market improved by +16 bps.  This may’ve been enough to slightly improve mortgage rates or fees.  Mortgage rates experienced very low volatility throughout the week.This Week’s Rate Forecast: Neutral

Three Things: These are the three areas that have the greatest ability to impact mortgage rates this week: 1) Geopolitical, 2) Fed and 3) Domestic.

1.) Geopolitical: Across the pond, we have Theresa May teaming up with Northern Ireland to have the support she needs to stay in power and continue with Brexit negotiations which began last week. President Trump is meeting with the leader of India today to discuss trade, but the market focus is on the Senate as they attempt to vote on health care reform this week.

2.) Fed: There is no question that the Fed’s last statement was hawkish and points to another hike this year as well as fewer MBS purchases. But the bond market simply hasn’t come around to buying into that as a real possibility yet particularly given the recent bout of economic data. So, we will continue to pay very close attention to their speeches to see if they begin to shift market sentiment:

  • 06/26 John Williams
  • 06/27 John Williams, Patrick Harker, Janet Yellen and Neel Kashkari
  • 06/29 James Bullard

3.) Domestic: We have a big week for economic data with some big name reports that have the ability to move the needle for mortgage rates. The most important one is Friday’s PCE report which is what the Fed uses as their official inflation gauge. We also have Durable Goods, Chicago PMI, Consumer Confidence and the final revision to the 1st QTR GDP.

Treasury Auctions:

  • 06/26 2 year note
  • 06/27 5 year note
  • 06/28 7 year note

This Week’s Potential Volatility: Average

A very pivotal week. We have been trading in a very well defined channel for the past two weeks. We actually have an opportunity to break out of that channel for worse mortgage rates this week. That momentum lower can only come from the passage of the Health Care reform in the Senate. IF it is not passed, then we will stay in our current channel.

Bottom Line:

If you are looking for the risks and benefits of locking your interest rate in today or floating your loan rate, contact your mortgage professional to discuss it with them.

 


About Bob Brenner

My goal is to provide an uneventful mortgage experience that is so barely noticed from beginning to end that it will be remarkably pleasing at closing. I teach my clients how to use their home loan as a tool in planning, creating, and securing a lasting foundation for long-term wealth.

 

 


About This Report And Disclosure Information

All information furnished has been forwarded to you and is provided by thetbwsgroup only for informational purposes. Forecasting shall be considered as events which may be expected but not guaranteed. Neither the forwarding party and/or company nor thetbwsgroup assume any responsibility to any person who relies on information or forecasting contained in this report and disclaims all liability in respect to decisions or actions, or lack thereof based on any or all of the contents of this report.Licensed by the Department of Business Oversight under the California Residential Mortgage Act. Guild Mortgage Company NMLS # 3274.

 


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