The big news this morning is the confirmation that President Trump canceled next month’s meeting with North Korea’s Kim Jong Un. Yesterday’s dovish Federal Open Market Committee Meeting minutes are also playing into a slide for bond yields and mortgage rates. Read on for more details.
Where are mortgage rates going?
Rates hit highs in Freddie Mac PMMS
The Freddie Mac Primary Mortgage Market Survey got released a few moments ago and it’s showing that mortgage rates moved up to new seven-year highs. With long-term government bond yields moving higher, this was no surprise. Here are the numbers:
- The average rate on a 30-year fixed rate mortgage moved up five basis points to 4.66% (0.4 points)
- The average rate on a 15-year fixed rate mortgage went up seven basis points to 4.15% (0.4 points)
- The average rate on a 5-year adjustable rate mortgage moved up five basis points to 3.87% (0.3 points)
Here is what the Economic and Housing Research group had to say about rates this week:
“Mortgage rates moved up over the past week to 4.66 percent, their highest level since May 5, 2011 (4.71 percent).
Mortgage rates so far in 2018 have had the most sustained increase to start the year in over 40 years. Through May, rates have risen in 15 out of the first 21 weeks (71 percent), which is the highest share since Freddie Mac began tracking this data for a full year in 1972.
At a time when housing inventory remains extremely low, it’s worth watching whether these higher borrowing costs lead some would-be sellers to stay put in their current home. Inventory shortages would likely worsen if more homeowners decide not to sell out of reluctance of having a new mortgage with a higher rate.”
It’s important to note that the data for the Freddie Mac PMMS is collected early on in the week and doesn’t necessarily reflect current market conditions.
For instance, we’ve seen the yield on the 10-year Treasury note, which is the best market indicator of where mortgage rates are going, move down several basis points over the past couple days.
Mortgage rates typically move in the same direction as the 10-year yield, so average rates across the nation are likely lower than what the report shows.
| [contentbox id=”10″] |
Rate/Float Recommendation
Lock before rates move even higher
Mortgage rates keep moving higher and higher. Despite the modest dip over that past couple of days, the long-term projection for rates is to gradually increase. To avoid the risk of locking in a higher rate, we’re recommending that borrowers try to take action on a purchase or refinance sooner rather than later.
Learn what you can do to get the best interest rate possible.
Today’s economic data:
Jobless Claims
Applications filed for U.S. unemployment benefits came in at 234,000 for the week of 5/19/18. That’s up 11,000 from the previous week.
FHFA House Price Index
Home prices rose by 0.1% in the month of March. That puts the yearly rise at 6.7%.
Existing Home Sales
Existing home sales came in at an annualized rate of 5.460 M. That’s a monthly decline of 2.5%, bringing the year over year change at -1.4%.
Kansas City Fed Manufacturing Index
- 11:00am
Fedspeak
- New York Fed President William Dudley at 4:15am
- Atlanta Fed President Raphael Bostic at 10:35am
- Philadelphia Fed President Patrick Harker at 2:00pm
[contentbox id=”3″]
Notable events this week:
Monday:
- Chicago Fed National Activity Index
- Fedspeak
Tuesday:
- Richmond Fed Manufacturing Index
Wednesday:
- PMI Composite Flash
- New Home Sales
- EIA Petroleum Status Report
- FOMC Minutes
- Fedspeak
Thursday:
- Jobless Claims
- FHFA House Price Index
- Existing Home Sales
- Kansas City Fed Manufacturing Index
- Fedspeak
Friday:
- Durable Goods Orders
- Consumer Sentiment
- Fedspeak
[contentbox id=”3″]
from Total Mortgage Blog https://ift.tt/2GMB2NZ
No comments:
Post a Comment