It’s been good news this week for home buyers and home owners looking to refinance as mortgage rates have improved. It hasn’t been a big swing lower but mortgage rates have mostly remained lower after a drop on Monday morning. Read on for more details.
Where are mortgage rates going?
Mortgage rates move lower in the Freddie Mac PMMS
Current mortgage rates have moved lower for second straight week, according to the Freddie Mac Primary Mortgage Market Survey (PMMS).
Here are the numbers:
- The average rate on a 30-year fixed rate mortgage moved lower by two basis points to 4.51% (0.5 points)
- The average rate on a 15-year fixed rate mortgage ticked lower by three basis points to 3.98% (0.5 points)
- The average rate on a 5-year adjustable rate mortgage fell by five basis points to 3.82% (0.03 points)
Here is what Freddie Mac’s Economic & Housing Research Group had to say about rates this week:
“Mortgage rates inched backward this week to their lowest level since mid-April.
Backed by very strong consumer spending, the economy is red-hot this month, which is in turn rippling through the financial markets and driving equities higher.
Unfortunately, the same cannot be said about the housing market, where it appears sales activity crested in late 2017. Existing-home sales have now stepped back annually for the fifth straight month, and purchase mortgage applications this week were barely above year ago levels.
It is clear affordability constraints have cooled the housing market, especially in expensive coastal markets. Many metro areas desperately need more new and existing affordable inventory to break out of this slump.”
Lock now before move even higher
While mortgage rates have improved for the second consecutive week, the long-term outlook continues to be for them to gradually increase as the Federal Reserve gets ready for and follows through with increases to the nation’s benchmark interest rate. The first hike is expected to take place next month, with another likely in December.
Today’s economic data:
Applications filed for U.S. unemployment benefits for the week of 8/18 came in at 210,000. That’s 2,000 lower than the previous reading, bringing the 4-week moving average down to 213,750.
FHFA House Price Index
The FHFA House Price Index increased 0.2% from the previous month in June. That brings the year over year increase to 6.5%.
PMI Composite Flash
The PMI Composite index hit a 55.0 in August. Manufacturing came in at 54.5 while Services hit 55.2.
New Home Sales
New Home Sales for July came in at an annualized rate of 627,000. That’s slightly below the consensus reading of 649,000.
Jackson Hole Symposium
Kicks off today and ends tomorrow.
Kansas City Fed Mfg Index
Notable events this week:
- Existing Home Sales
- EIA Petroleum Status Report
- FOMC Minutes
- Jobless Claims
- FHFA House Price Index
- PMI Composite Flash
- New Home Sales
- Jackson Hole Symposium
- Kansas City Fed Mfg Index
- Jackson Hole Symposium