Mortgage Market Update
Mortgage Market Update
Published 9:33 PM, Sun February 10, 2013
Mortgage Market Update-February 10, 2013
The mortgage market seemed to sleep through this week, though after all of the news from last week, this week provided far less fodder for the mortgage market. Although the mortgage market remained largely unchanged in some cases, lenders increased rates slightly over the course of the week since the stock market continued its upwards trend which is never good for the bond market. The good news is, rates are still considerably below past years.
News of the past week
Last week there was a collective gasp when the GDP fell because many people felt it signaled a potential problem. However, offsetting information this week may mean the recent GDP drop of .1 percent may be revised upward. This week, new numbers for trade deficits offered some good news. Our current trade deficit is $38.5 billion but this number is misleading if you do not understand the history. In November the trade deficit was $48.6 billion so this is a $10 billion decrease and reflects an overall drop to levels not seen in three years. One of the primary drivers of this drop (which is actually nearly four percent during 2012) is oil exports. US crude oil imports are at their lowest levels since 1997 which is good for the economy.
The housing market
The news on the housing market was positive for the sixth month in a row. This is good news for those who are interested in buying a home but may be even better news for those interested in selling. The latest report shows that 259 of 361 metro regions are improving (roughly 70%), up from just 12 regions in September 2011. This is good news and shows that the housing market is continuing to improve.
Overseas goings on
Markit’s Purchasing Managers’ Index (PMI) for German manufacturing rose just over three percent in December. This may mean overall growth will continue for this area meaning an improvement in the overall economy in Germany. It was also notable that the European Central Bank (ECB) made no changes in rates this week.
The upcoming week
During the upcoming week, we will get reports on retail sales and the Fed will continue their bond buy-back program. Currently the Fed is scheduled to auction $66 billion in bonds through the week. Treasury auctions will be held on Tuesday, Wednesday and Thursday. Another important thing to watch during the upcoming week is consumer confidence numbers and how Congress and the White House are discussing the upcoming sequester. These may have an impact on the bond market.
While the economy is continuing its somewhat sluggish growth, there are still many opportunities for buying a home or refinancing your existing mortgage. If you are uncertain about locking your rate in, contact Core Mortgage Financial. We will help you make a decision as to whether now is a good time to consider locking your rate in or if it is worth waiting for rates to tick downward again.