Mortgage Blog

Mortgage Market Update- December 30, 2012

One of the upsides of having the least productive Congress ever if that it’s been good for bond prices. This week was no exception. As Congress left for the holiday with no agreement in sight for the looming fiscal cliff, the bond markets reaped the benefits of the lack of agreement and headed slightly downwards this week. There was some other interesting news this week that offered a glimmer of hope for an improving economy in spite of the fact that consumer confidence fell to the lowest level in four months.

The housing market

Finally, home buyers and those who are interested in selling their homes are seeing some light that may be finally signaling the end of the housing bust. Home prices are rising slightly, new construction is on the rise and contracts for existing homes are showing their strongest levels since April of 2010. It’s important to note that in April of 2010, the home buyer tax credits expired so this is very good news.

The job market

For the first time in nearly 4 1/2 years, the jobless claim rates fell below 360,000. This is a sign that business owners are hiring again. However, we should be aware that some of this may be seasonal jobs, we’ll probably have to wait until the spring to determine if these rates stay in this range. For the time being however, it does appear that employers are feeling more confident, a sign that they have more demand for their goods.

The oil market

According to the Associated Press, “U.S.. benchmark crude fell 7 cents to finish at $90.80 a barrel.” This is largely due to the fiscal cliff talks going on. The other good news here is that production in the United States is up to 7 million barrels a day. This is a benchmark, we’ve not seen these types of levels since the early 90’s. Consumers will be happy to know that heating oil prices dropped three cents a gallon and gasoline also dropped two cents a gallon. On the downside however, natural gas prices rose six cents per 1,000 cubic feet.

Whether you are considering refinancing your existing mortgage or you are in the process of financing a new home, this may be the time to lock in your existing rate. Most pundits and politicians believe that we will reach a fiscal cliff deal before the December 31 deadline. As a result, there is a good chance that mortgage rates may increase slightly over the next week or so.  Contact Core Mortgage Financial if you need help locking in a rate or if you are ready to start a purchase or refinance mortgage application.

Disclaimer: Mortgage Market update is for December 24-28, 2012. This article is for informational purposes only. The mortgage market update should not be used for rate lock guidance