Mortgage Market Update
by Tom on July 14, 2009
in Market Report, Mortgage Matters, Mortgage Rate Updates
It’s time to take a look at what’s driving the markets today. A couple of economic reports are putting some upward pressure on rates today:
- Retail sales were actually up from May. This is good news! If you look at the graph below that I got from Bill over at Calculated Risk, it shows that we might be starting to see a “bottom” in retail sales but that bottom is a long ways from what we were at a year ago…..
- Goldman Sachs reported much better than expected earnings, buoyed by a lack of competition (everyone else went under) and a stronger stock market.
- The Producer Price Index came in much higher than expected. When you remove the “volatile stuff” it came in more moderately but still above what the markets liked. The perceived risk of inflation is hampering mortgage bonds and that’s part of what’s causing the upward trend in mortgage rates today.
- Business inventories are down for the 9th month in a row. This is actually a good sign because the lower inventories go, the more likely it is that they will eventually have to make more “stuff” and it takes people to make “stuff.” (How’s that for the technical terms?)
So with all of that going on, rates are a bit higher now than they were yesterday.
My recommendation remains to lock all loans. The volatility remains on the upside rather than the downside.
Stay tuned, it’s going to be a volatile week!
Tom Vanderwell
P.S. Here’s some of the rates that I’m quoting today:
Purchase $175,000 sales price, 10% down, 30 year fixed, 30 day lock, 5.125% with no points or 4.875% with .75 pts.
Purchase $250,000 sales price, 3.5% down, FHA 30 year fixed, 30 day lock, 5.125% with 1 pt or 5.375% with no points.
Refinance, $200,000 loan amount, 80% loan to value or less, 30 year fixed, 60 day rate lock, 5.5% with 0 pts
APRs available upon request
