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2017-02-24 15:22:24
Homes sales on the rise in January
'With a friend and a stick or three or four a house is built where it wasn't before.' Carly Simon. Home sales were on the rise in January.

Existing Homes Sales hit 10-year highs, the National Association of REALTORS® reported. January Existing Home Sales surged by 5.69 million annualized units, up 3.3 percent from December to highs not seen since February 2007. All major regions across the nation saw gains, with the exception of the Midwest. The median existing home price rose 7.1 percent from January 2016. Overall inventory of existing homes remained low, however, at just a 3.6-month supply.

New Home Sales rebounded in January. The Commerce Department reported New Home Sales rose 3.7 percent from December to an annual rate of 555,000. The increase was below the 566,000 expected, but it comes after a 7 percent decline in December. Sales also were up 5.5 percent from January 2016. The median sale price was up 7 percent from a year ago. Inventories were unchanged at a near-normal 5.7 months' supply.

For those in the market for a new or existing home, home loan rates remain in historically low territory despite the volatility in Stock and Bond markets over the last few weeks.

If you or someone you know has any questions about current home loan rates or products, please don't hesitate to contact me.

Forecast for the Week
The week is loaded with headline reports. Which ones will land above the fold and move markets?
  • Pending Home Sales will be delivered Monday.
  • Manufacturing data releases start on Monday with Durable Goods Orders. The Chicago PMI will be released Tuesday, followed by the ISM Index Wednesday.
  • The second estimate for first quarter Gross Domestic Product will be watched by investors as well as the Fed when it is announced on Tuesday.
  • Consumer data is plentiful with the release of Consumer Confidence Tuesday, as well as Personal Income, Personal Spending and the inflation-reading Personal Consumption Expenditures Wednesday.
  • The Fed's Beige Book is due out Wednesday.
  • As usual, weekly Initial Jobless Claims will be reported on Thursday.
  • The non-manufacturing ISM Services Index will be released Friday.
Remember: Weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bonds and home loan rates improve. In contrast, strong economic news normally has the opposite result. The chart below shows Mortgage Backed Securities (MBS), which are the type of Bond on which home loan rates are based.

When you see these Bond prices moving higher, it means home loan rates are improving. When Bond prices are moving lower, home loan rates are getting worse.

To go one step further, a red 'candle' means that MBS worsened during the day, while a green 'candle' means MBS improved during the day. Depending on how dramatic the changes are on any given day, this can cause rate changes throughout the day, as well as on the rate sheets we start with each morning.

As you can see in the chart below, Mortgage Bonds prices have seesawed in recent weeks and rebounded. Despite recent volatility, home loan rates are still in attractive territory.

Chart: Fannie Mae 3.5% Mortgage Bond (Friday Feb 24, 2017)
Japanese Candlestick Chart


The material contained in this newsletter is provided by a third party to real estate, financial services and other professionals only for their use and the use of their clients. The material provided is for informational and educational purposes only and should not be construed as investment and/or mortgage advice. Although the material is deemed to be accurate and reliable, we do not make any representations as to its accuracy or completeness and as a result, there is no guarantee it is without errors.

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Blog Archive
2018-02-16 00:11:43
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2017-02-24 15:22:24
Homes sales on the rise in January

2017-02-24 12:01:39
2 Things to Know about Home Inspections

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