For more information on today's interest rates call Bill Yarnall 727-209-7994 or check out my website at http://wyarnall.kwrealty.com/.
Last week was pretty quiet as far as things go in the mortgage industry but with Mortgage Backed Securities (MBS) losing -49 basis points from the previous Friday’s close the two week Bond rally came to an end and mortgage rates moved slightly higher.
This small increase could have been much worse as we saw better than expected results from Durable Goods and Consumer Sentiment reports. One reason the rate increase wasn’t so bad is because of a report in the Wall Street Journal. They stated that the FED would continue to keep their interest rates low for quite some time and this had a calming effect on the market – but – the Fed Fund rates do not have an impact on your mortgage rates. Eventually they will have to start pulling back on Bond purchases which is what really drives the interest you pay.
BOTTOM LINE:
Expect much more volatility this week. There is a lot of economic data due to be released which will have a very strong effect on the MBS Market.
You must be prepared and let your buyers know this week could be a real roller coaster. The trend has been for interest rates to go up. Now would be a good time to talk to your mortgage professional (that would be me) about locking in on a rate and not potentially risking a hefty hike.
Meantime….back down on the Farm - there was some really great news in the Real Estate industry with Pending Home Sales climbing from this time last year by 10.9% (according to NAR). The market had expected a drop due to increased mortgage rates over the last term but the demand was greater than consumer fears and the housing market was able to absorb those increases. Based on the YTD activity and stable contract signings expected for the balance of the year existing home sales are projected to rise by more than 8% through the course of 2013. With inventory shortages continuing NAR is projecting median prices to rise by nearly 11% this year.
Prepared by:
Craig Inglis
Loan Officer
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