Thursday – December 6, 2022
Home borrowing costs rose to near levels seen in April of 2021 this week and remain historically low. Freddie Mac reports that the 30-year fixed-rate mortgage rose 11 basis points to 3.22 with 0.7 in points and fees. The record low was 2.65% on January 7, 2021. Sam Khater, Freddie Mac’s Chief Economist said, “With higher inflation, promising economic growth and a tight labor market, we expect rates will continue to rise. The impact of higher rates on purchase demand remains modest so far given the current first-time homebuyer growth.”
First-time unemployment claims continued to remain low in the latest week as the country continues to get back to normal as the pandemic subsides. At present, there are nearly 11 million jobs available across the nation. The Labor Department reports that Weekly Initial Jobless Claims rose 7,000 to 207,000 for the week ended January 1, 2022. Continuing claims, or those receiving benefits for at least two weeks straight, rose to 1.754 million from 1.718 million.
The minutes from the December 15, 2021 FOMC meeting signaled that Fed members could raise rates sooner rather than later given sustained higher inflation along with an improving economy and labor market. From the minutes, members “generally noted that, given their individual outlooks for the economy, the labor market, and inflation, it may become warranted to increase the federal funds rate sooner or at a faster pace than participants had earlier anticipated.” Several participants, meanwhile, “viewed labor market conditions as already largely consistent with maximum employment.”
Courtesy of Mortgage Market Guide
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Wednesday – December 5, 2022
Private employers hired workers in droves in December as job availability is plentiful across the nation. ADP Private Payrolls jumped 807,000 last month from the 505,000 jobs created in November and above the 400,000 expected. It was the fastest pace in private job growth in seven months. The big gains were seen in hospitality and leisure. The report comes ahead of the more closely watched government Jobs Report which includes Non-Farm Payrolls and the Unemployment Rate.
Home borrowing costs inched higher were unchanged in the latest week and remain just above historic lows. The MBA reports that that the 30-year fixed-rate mortgage rose two basis points to 3.33% with 0.48 in points for the week ended December 31, 2021. Within the report it showed that the Market Composite Index fell 5.6%, the Purchase Index declined 10.2% while the Refinance Index dropped 2.5% for the previous two weeks. An MBA spokesperson said, “Despite supply and affordability challenges, 2021 was a record year for purchase originations. MBA expects 2022 to be even stronger, with total purchase activity reaching $1.74 trillion.”
Courtesy of Mortgage Market Guide
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Tuesday – December 4, 2022
Homeownership in the U.S. again less affordable in Q4 2021 as prices keep soaring. ATTOM Data Solutions reports that its Q4 2021 U.S. Home Affordability Report shows that median-priced single-family homes were less affordable in Q4 to historical averages in 77% of counties across the nation. That’s up from 39% of counties that were historically less affordable in Q4 2020, to the highest point in 13 years, as home prices increase quicker that wages across the nation.
Just the facts from the U.S. Census Bureau: The U.S. homeownership rate remained at 65.4% in Q3 2021, unchanged from Q2 and down from 67.4% in Q3 2020. In Q3 2021, the median asking rent for vacant for rent units was $1,203. National vacancy rates in Q3 2021 were 5.8% for rental housing and 0.9% for homeowner housing. Approximately 89.3% of the housing units in the United States in the third quarter 2021 were occupied and 10.7% were vacant.
Courtesy of Mortgage Market Guide
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Monday – December 3, 2022
The U.S. financial markets begin the new year with stocks hovering near all-time highs while Treasury yields remain relatively low. This week features Wednesday’s release of the December Fed minutes, which could give the markets more insight on rates, tapering and reinvestment of portfolio runoff. ADP Private Payrolls and the Jobs Report for December will be reported Wednesday and Friday, respectively.
Mortgage rates remain on the low end of the historical range with the 30-year fixed-rate mortgage at 3.11% with 0.7 in points and fees for the week ended December 30, 2021, reports Freddie Mac. The 15-year fixed-rate averaged 2.33% with 0.7 in points and fees. Freddie Mac’s Chief Economist Sam Khater said, “While we do expect rates to rise, the push of the first-time homebuyer demographic that’s been propelling the purchase market will continue in 2022 and beyond.”
Courtesy of Mortgage Market Guide
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