Mortgage Rates Weekly Update [July 3 2017]
Mortgage Rates Weekly Update for July 3, 2017
Mortgage Rates Weekly Update for July 3, 2017 by John R. Thomas with Primary Residential Mortgage, Inc. in Newark, Delaware. John Thomas is the Branch Manager, a Delaware Loan Officer and the author of the best selling book, Your Guide to Buying Your First Home in Delaware. Call 302-703-0727 for a Rate Quote or Apply Online for Rate Quote
Mortgage Rates moved higher to end the week as mortgage bonds sold off. If you look at the mortgage bond chart below you can see mortgage bonds broke beneath a level of support that has held for the past several weeks which is a bad technical signal. The short term outlook is for mortgage bonds to continue to trend lower so we are recommending LOCKING your mortgage rate to start the week.
In Economic News
The Final Read on first quarter of 2017 Gross Domestic Product (GDP) came in at 1.4% which is much improved over the first reading of 0.7%. The biggest driver of economic activity is consumer spending which rose 1.1 percent which was up from 0.6% in the first reading.
Friday we saw a read on inflation from the Personal Consumption Expenditures (PCE) which is the Feds favorite measure of inflation and it dropped from 1.7% to 1.4%. Inflation has been trending down and was 2.1% just a couple of months ago. Part of the reason for the decline is that oil prices are now being compared on a year over year basis to higher numbers from last year.
Weekly Initial Jobless Claims were released on Thursday and came in at 244,000 claims for the week. Last week’s jobless claims were 242,000 and were also the sample week to be used in the May Jobs Report which will be released on Friday. This is a strong reading on the labor market so points to a very strong jobs report on Friday.
In Housing News
The Case-Shiller 20 City Home Price Index fro April 2017 showed a 5.7% gain from April 2016. Home prices continue to rise in part due to a limited supply of homes for sale in many areas across the country. The low mortgage rates are also causing more people to want to buy before rates move up which is putting more pressure on home prices as people compete for the limited inventory available for sale.
New Home Sales in May 2017 jumped 3 percent from April 2017 to 610,000 units which was above expectations of 599,000 units. New Home Sales were up almost 9 percent from May 2016. The median home price of a new home hit a record of $345,800 as tight inventory pushed up home prices. National supply of homes is 4.6 months and healthier inventory level is a six month supply of homes for sale.
Existing Home Sales for May 2017 rose 1.1 percent from April 2017 to 5.62 Million units which was also above expectations of 5.52 million units. Existing Home Sales were up 2.7% from May 2016. Low inventories of resale homes continue to be a problem.
Pending Home Sales for May 2017 fell by 0.8% from April 2017 to 108.50 million units. Pending Home Sales measures the number of existing homes that received contracts for the month. It is a sign of future existing home sales. Pending home sales are down 1.7% from last year as the tight inventory makes it tough for home buyers.
The Delaware legislature passed the operating budget which included a bill to raise the state transfer tax on the sale of real estate from 3% to 4% which makes Delaware the most expensive state in the United States for closing costs. This comes among a struggling housing market that is ranked 2nd in the US for foreclosures. The bill did not add the first time home buyer exemption for the increase in the state portion of the transfer tax. So on the purchase of a $250,000 home, a first time home buyer in Delaware will see the transfer tax go from $1,875 to $3,125! So if you are looking at buying or selling a home in Delaware, Get under contract before August 1, 2017.
First Time Home Buyer Seminars Coming Up:
The next Delaware First Time Home Buyer Seminar is Saturday July 22, 2017 in Newark, Delaware.
Register by calling 302-703-0727 or Register online at http://www.DelawareHomeBuyerSeminar.com
DE Mortgage Rates remain near all time record low rates but having been moving higher as of late, so it is the perfect time to purchase or refinance a home before interest rates move even higher. Call 302-703-0727 for a free mortgage consultation with a licensed mortgage loan officer that can review your options with you or APPLY ONLINE
Mortgage Rates Weekly Update