Daily Rate Update: December 6th-10th

Thursday – December 9, 2021

Home borrowing costs are essentially unchanged this week and remain just above historic lows. Freddie Mac reports that the 30-year fixed-rate mortgage is 3.10% with 0.6 in points and fees. The record low was 2.65% on January 7 of this year. Sam Khater, Freddie Mac’s Chief Economist said, “Mortgage rates have moved sideways over the last several weeks, fluctuating within a narrow range. Rates remain low and stable, even as the nation faces declining housing affordability and low inventory.”

First-time unemployment claims fell to lows not seen in 52 years as the country continues to get back to normal as the pandemic subsides. At present, there are 11 million jobs available across the nation. The Labor Department reports that Weekly Initial Jobless Claims rose fell 43,000 to 184,000 for the week ended December 4, 2021. Continuing claims, or those receiving benefits for at least two weeks straight, fell to 1.992 million from 1.954 million. The labor market should continue to improve with the holiday shopping season well underway.

The two-day FOMC meeting kicks off next week on Tuesday, December 14, and culminates on Wednesday with the 2:00 p.m. ET release of the monetary policy statement which includes economic projections. Fed Chair Powell will hold a press conference at 2:30. There is a zero percent chance of a hike to the short-term Fed Funds Rate. The statement will most likely include communication on the tapering of the Fed’s massive bond buying program and when to expect higher rates

Courtesy of Mortgage Market Guide 

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Wednesday – December 8, 2021

Home borrowing costs were unchanged in the latest week and remain just above historic lows. The MBA reports that that the 30-year fixed-rate mortgage stands at 3.30% with 0.39 in points. Within the report it showed that the Market Composite Index rose 2%, the Refinance Index gained 9% while the Purchase Index declined 5%. An MBA spokesperson said, “Purchase activity continues to be constrained by a lack of inventory, combined with rapid rates of home-price appreciation and mortgage rates higher than in 2020.”

Fannie Mae released its November Home Purchase Sentiment Index this week revealing that economic pessimism hits a 10-year high, consumer sentiment toward housing remains flat while 70% those surveyed believe the economy is on the wrong track. “Consumers’ concerns for their personal job situation have eased and respondents also reported feeling better about their income level compared to a year ago, with both of those components now nearing their pre-COVID levels,” said Mark Palim, Fannie Mae Vice President and Deputy Chief Economist.

The number of job openings increased to 11.0 million on the last business day of October, the Bureau of Labor Statistics (BLS) reported today in its JOLTS report. Job openings increased in several industries with the largest increases in accommodation and food services (+254,000). Total separations includes quits, layoffs and discharges, and other separations. Quits are generally voluntary separations initiated by the employee. Therefore, the quits rate can serve as a measure of workers’ willingness or ability to leave jobs. Layoffs and discharges are involuntary separations initiated by the employer. Other separations includes separations due to retirement, death, disability, and transfers to other locations of the same firm.

Courtesy of Mortgage Market Guide 

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Tuesday – December 7, 2021

Strong demand and low inventories propelled home prices higher in October, reports CoreLogic in its latest Home Price Insights report released today. Home prices nationwide, including distressed sales, rose 18% from October 2020 to October 2021 and were up 1.3% monthly from September to October. CoreLogic is forecasting that home prices will rise monthly by 0.2% from October 2021 to November 2021, and annually by 2.5% from October 2021 to October 2022. “New household formation, investor purchases and pandemic-related factors driving demand for the limited supply of available for-sale homes continue to propel the upward spiral of U.S. home prices. However, we expect home price growth to moderate over the near term as many buyers take a break for the holidays,” said Frank Martell, President and CEO of CoreLogic.

As the season changes from summer to fall to winter, gasoline demand at the pumps typically decrease as Americans cut down on driving. In addition, it is less costly to refine oil to gasoline in the winter months. This has led to a decline in the price of gasoline. The national average price for a regular gallon of gasoline is at $3.35, down from $3.44 a month ago though up from $2.16 a year ago. California remains the highest at $4.68.

Redfin reports that for-sale home supply hit an all-time low in the latest survey. With home prices near record highs, for sale homes have found buyers within one week. The number of homes for sale hit an all-time low during the week ending November 28, which could give potential buyers a big obstacle to jump in the coming months. Active listings of homes for sale fell to an all-time low of 538,695 at the end of November, down 26% year over year and down from 967,199 in 2019.

Courtesy of Mortgage Market Guide 

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