Mortgage Market Update
Good financial news is nearly always good news for the mortgage market. Unfortunately, during election season, good news is often lost in a flurry of negative advertisements resulting in many of us missing positive changes in the economy. The news isn’t all great, but there are some very positive signs that the recovery is continuing and it is evident in the housing market. The mortgage market remained flat this week.
The Beige Book, which is published by the Fed eight times a year, reported broad positive news for the housing market. Existing home sales are up in nearly all districts, and the good news for home sellers is that the prices are also increasing. There is also a modest increase in new home building, which can often be an early signal of recovery in the housing market.
Consumer sentiment continues to be positive, with many economists claiming that this may be a result of the lower than expected new jobless claims and higher than expected new jobs reported last week. Gasoline prices remain a concern for many consumers, however this does not seem to be preventing them from feeling more confident about the economy in general, confidence levels are currently at their highest levels in five years.
Naturally, overseas market concerns continue to weigh heavily on the overall US economic picture, most notable this week is the downgrading of Spains sovereign debt, the third such downgrade in three years. This downgrade was especially strong, with S & P downgrading the debt two grades resulting in the credit rating being just above junk bonds. Don’t forget, Spain owes the US $64.2667 billion.
In spite of the Spain debacle this week, or perhaps because of it, US bonds sales remained robust since the ongoing economic crisis in Europe meant more investors are seeking refuge in US bonds. This resulted in a strong sales and helped keep mortgage rates lower.
While most of the good economic news in the US this week was greeted with a sigh, resulting in little action in overall mortgage rates, the positive trend for US Treasuries and high mortgage backed securities sales managed to move the overall mortgage rates slightly lower this week. The continued good news means we are not likely to see mortgage rates continue their downtick, especially as home sales continue their upward trend. It does appear that lending restrictions are loosening so if you’re considering buying a home or refinancing your current mortgage, this is a great time to consider doing so. Contact Core Mortgage Financial and let us help you find the best mortgage rates for all your Florida mortgage lending needs.