Mortgage Weekly Update - Last Week in Review - Loan rates higher
Foster Weeks publishes a weekly mortgage update which is updated every Monday morning....Well...like it or not, last week's economic news continued to rain on the parade for Bond prices and home loan rates. Most of the reports showed stronger than expected data and signs of a strong economy. This tends to be bad news for Bonds and home loan rates, as on the heels of good news, investors tend to pull money from safe-haven Bonds and inject them into Stocks, which have a better chance of profiting from a strong US economy. Overall, home loan rates worsened by about .125%.
Decent news on the housing front, as New Home Sales came in better than expectations, and while Existing Home Sales were slightly less than expected, both enjoyed improved paces of inventory. Looking at last year, 2006 represented the 3rd best existing home sale market on record. But the media is already putting a doom and gloom spin on the story, making a buzz about the steep drop from 2005 to 2006, and the fact that sales haven't fallen off this much year-over-year since the early 80's. But some important considerations: first, 2006 is coming off a record year in 2005, so to see a drop off in record levels is not unexpected. Second, the media is comparing the drop in year-over-year sales to the early 80's - but in 1982 the national unemployment rate was 9.7%...more than double the current unemployment rate. Many experts believe that we will look back at August 2006 as the bottom of the housing market.
- Foster Weeks
posted by SFResidence.com @ 8:14 AM
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