In the News

Retail sales rose 1.1% to $412.9 billion in September. This follows an upwardly revised 1.2% increase in August. Compared to September 2011, retail sales have increased 5.4%.

Consumer prices rose 0.6% in September, following an identical 0.6% increase in August. Compared to September 2011, consumer prices have risen 2%. Consumer prices at the core rate — excluding volatile food and energy prices — were up 0.1% in September.

The National Association of Home Builders/Wells Fargo monthly housing market index rose one point in October to 41, the highest level since June 2006. This marks the sixth consecutive monthly gain. An index reading below 50 indicates negative sentiment about the housing market.

The Mortgage Bankers Association said its seasonally adjusted composite index of mortgage applications for the week ending October 12 fell 4.2%. Refinancing applications decreased 5%. Purchase volume rose 1%.

The combined construction of new single-family homes and apartments in September rose 15% to a seasonally adjusted annual rate of 872,000 units. Single-family starts increased 11%. Volatile multifamily starts rose 25.1%. Compared to a year ago, housing starts were up 34.8% in September. Applications for new building permits, seen as an indicator of future activity, rose 11.6% to an annual rate of 894,000 units.

Existing home sales fell 1.7% in September to a seasonally adjusted annual rate of 4.75 million units from 4.83 million units in August. Compared to a year ago, existing home sales were up 11% in September. The inventory of unsold homes on the market fell 3.3% to 2.32 million in September, a 5.9-month supply at the current sales pace, down from a 6.1-month supply in August.

Initial claims for unemployment benefits for the week ending October 13 rose by 46,000 to 388,000. Continuing claims for the week ending October 6 fell by 29,000 to 3.25 million.

from Prospect Mortgage Economic Update

Enhanced by Zemanta

Fed Moves to Keep Rates Low

Daily Real Estate News |      Friday, September 14, 2012

The Federal Reserve announced Thursday that, in an effort to re-ignite economic recovery, it was taking aim at mortgage rates— a move that will likely take rates even lower from their current record lows.

The Federal Reserve announced it will purchase $40 billion of mortgage-backed securities that will help boost the recovery in the housing market. What’s more, the central bank said that it will continue with the purchase program until the economy shows greater improvement, particularly with unemployment.

“These actions, which together will increase the Committee’s holdings of longer-term securities by about $85 billion each month through the end of the year, should put downward pressure on longer-term interest rates, support mortgage markets, and help to make broader financial conditions more accommodative,” according to the Fed in a public statement.

The Fed says the economy still has a long way to go toward recovery. The Fed predicts the jobless rate will stay above 7 percent well into 2014 and that economic growth will remain slow in the coming months.

At its Thursday meeting, the Fed left its funds rate unchanged at near-zero, but announced the rate — which has a bearing on mortgages — would remain at “exceptionally low levels” until at least mid-2015.

As mortgage rates sink lower, home shoppers have been taking advantage. The Mortgage Bankers Association announced this week that mortgage applications for home purchases were up 8.1 percent for the week ending Sept. 7. Mortgage applications for purchases also were up 7 percent from year-ago levels, MBA said.

“While low interest rates impose some costs, Americans will ultimately benefit most from the healthy and growing economy that low interest rates promote,” Fed Chairman Ben Bernanke said Thursday following the Fed committee’s meeting.

Source: “Fed Pulls Trigger, to Buy Mortgages in Effort to Lower Rates,” CNBC (Sept. 13, 2012)

Editor’s note: The Federal Reserve’s decision to buy $40 billion a month in mortgage-backed securities isn’t expected to have a significant impact on housing, since it’s no longer lower rates that stimulate home sales, says NAR Chief Economist Lawrence Yun. It’s even possible mortgage rates will rise, despite the Fed action, if private investors, fearful of inflation, sell mortgage-backed securities at a faster rate than the Fed is purchasing them. A game changer for housing would be something that moves the dial on lenders’ underwriting standards, from today’s overly stringent standards to standards that are closer to normal — that is, closer to the safe but reasonable underwriting standards that characterized lender practices prior to the housing boom.

Enhanced by Zemanta

Economic Update – In The News

The Mortgage Bankers Association said its seasonally adjusted composite index of mortgage applications for the week ending September 28 rose 16.6%. Refinancing applications increased 20%. Purchase volume rose 4%.

Manufacturing activity rose to 51.5 in September after a reading of 49.6 in August. A reading above 50 signals expansion. The uptick in manufacturing follows three consecutive months of slight contraction.

Total construction spending fell 0.6% to $837.1 billion in August, following a revised 0.4% decrease in July. Compared to August 2011, construction spending has risen 6.5%.

Retail sales fell 0.3% for the week ending September 29, according to the ICSC-Goldman Sachs index. On a year-over-year basis, retailers saw sales increase 2.4%.

Motor vehicle sales rose 4% in September to an annualized sales rate of 14.9 million cars and light trucks. It was the highest annual rate since March 2008. Compared to September 2011, motor vehicle sales have increased 13%.

Non-manufacturing activity rose to 55.1 in September from 53.7 in August. A reading above 50 signals expansion. It was the 33rd straight month of expansion in the services sector.

Factory orders fell 5.2% in August to a seasonally adjusted $452.8 billion, following a 2.6% increase in July. Excluding the volatile transportation sector, orders increased 0.7% in August.

Initial claims for unemployment benefits for the week ending September 29 rose by 4,000 to 367,000. Continuing claims for the week ending September 22 remained unchanged at 3.28 million. The unemployment rate fell to 7.8% in September from 8.1% in August. Employers added 114,000 jobs in September.

from Prospect Mortgage Economic Update

Enhanced by Zemanta

In the News

The Mortgage Bankers Association said its seasonally adjusted composite index of mortgage applications for the week ending September 7 rose 11.1%. Refinancing applications increased 12%. Purchase volume rose 8%.

The trade deficit increased to $42 billion in July from a revised $41.9 billion in June. Exports fell $1.9 billion or 1% to $183.3 billion. Imports fell $1.8 billion or 0.8% to $225.3 billion.

Wholesalers increased their inventories 0.7% to $485.2 billion in July. Sales at the wholesale level fell 0.1% to $402.4 billion in July. On a year-over-year basis, sales were 2.7% higher since July 2011.

The producer price index, which tracks wholesale price inflation, rose 1.7% in August, following a 0.3% increase in July. Compared to August 2011, wholesale prices have risen 2%. Core prices — excluding food and fuel — rose 0.2% in August.

Retail sales rose 0.9% to $406.7 billion in August. This follows a revised 0.6% increase in July. Compared to August 2011, retail sales have increased 4.7%.

Consumer prices rose 0.6% in August, following a flat reading in July. Compared to August 2011, consumer prices have risen 1.7%. Consumer prices at the core rate — excluding volatile food and energy prices — were up 0.1% in August.

Industrial production at the nation’s factories, mines and utilities fell 1.2% in August after a 0.5% rise in July. Compared to August 2011, industrial production has increased 2.8%. Capacity utilization eased to 78.2% in August from 79.2% in July.

Initial claims for unemployment benefits for the week ending September 8 rose by 15,000 to 382,000. Continuing claims for the week ending September 1 fell by 49,000 to 3.282 million.

from Prospect Mortgage Economic Update

Enhanced by Zemanta

In the News

Motor vehicle sales rose 2.8% in August to an annualized sales rate of 14.5 million cars and light trucks. It was the fastest pace since August 2009. Compared to August 2011, motor vehicle sales have increased 20%.

Manufacturing activity fell to 49.6 in August after a reading of 49.8 in July. A reading below 50 signals contraction. This was the third consecutive contraction since July 2009.

The Mortgage Bankers Association said its seasonally adjusted composite index of mortgage applications for the week ending August 31 fell 2.5%. Refinancing applications decreased 3%. Purchase volume fell 0.8%.

Total construction spending fell 0.9% to $834.4 billion in July, following a 0.4% increase in June. Compared to June 2011, construction spending has risen 9.3%.

The Labor Department reported that in the second quarter, productivity rose at an annual rate of 2.2% and labor costs increased at an annual rate of 1.5%.

Retail sales fell 0.4% for the week ending September 1, according to the ICSC-Goldman Sachs index. On a year-over-year basis, retailers saw sales increase 3.7%.

Non-manufacturing activity rose to 53.7 in August from 52.6 in July. A reading above 50 signals expansion. It was the 32nd straight month of expansion in the services sector.

Initial claims for unemployment benefits for the week ending September 1 fell by 12,000 to 365,000. Continuing claims for the week ending August 25 fell by 6,000 to 3.322 million. The unemployment rate fell to 8.1% in August from 8.3% in July. Employers added 96,000 jobs in August.

from Prospect Mortgage Economic Update

Enhanced by Zemanta

In the News

Pending home sales, a forward-looking indicator based on signed contracts, rose 2.4% in July after a 1.4% decrease in June. On a year-over-year basis, pending home sales are up 12.4% compared with July 2011.

The Standard & Poor’s/Case-Shiller 20-city housing price index — on a non-seasonally adjusted basis — rose 2.3% in June, following a 2.2% increase in May. On a year-over-year basis, prices rose 0.5% compared with June 2011.

The Mortgage Bankers Association said its seasonally adjusted composite index of mortgage applications for the week ending August 24 fell 4.3%. Refinancing applications decreased 6%. Purchase volume rose 1%.

The consumer confidence index fell to 60.6 in August from a revised 65.4 in July. The index was benchmarked at 100 in 1985, a year chosen because it was neither a peak nor a trough in consumer confidence.

The Commerce Department announced that gross domestic product — the total output of goods and services produced in the U.S. — increased at a revised annual rate of 1.7% in the second quarter of 2012, compared to the initial estimate of 1.5%. This follows a 2% pace of growth in the first quarter of 2012.

Retail sales rose 0.5% for the week ending August 25, according to the ICSC-Goldman Sachs index. On a year-over-year basis, retailers saw sales increase 3.4%.

Factory orders rose 2.8% in July to a seasonally adjusted $478.6 billion, following a 0.5% decrease in June. Excluding the volatile transportation sector, orders increased 0.7% in July.

Initial claims for unemployment benefits for the week ending August 25 were unchanged at 374,000. Continuing claims for the week ending August 18 fell by 5,000 to 3.316 million.

from Prospect Mortgage Economic Update

Enhanced by Zemanta

Last Week in the News

Retail sales fell 1.5% for the week ending August 18, according to the ICSC-Goldman Sachs index. On a year-over-year basis, retailers saw sales increase 3.1%.

Existing home sales rose 2.3% in July to a seasonally adjusted annual rate of 4.47 million units from 4.37 million units in June. Compared to a year ago, existing home sales were up 10.4% in July. The inventory of unsold homes on the market increased 1.3% to 2.4 million in July, a 6.4-month supply at the current sales pace, down from a 6.5-month supply in June.

The Mortgage Bankers Association said its seasonally adjusted composite index of mortgage applications for the week ending August 17 fell 7.4%. Refinancing applications decreased 9%. Purchase volume rose 0.9%.

New home sales rose 3.6% in July to a seasonally adjusted annual rate of 372,000 units from an upwardly revised rate of 359,000 units in June. The initial June reading was 350,000. On a year-over-year basis, new home sales are up 25.3% compared with July 2011. At the current sales pace, there’s a 4.6-month supply of new homes on the market.

Orders for durable goods — items expected to last three or more years — rose $9.4 billion or 4.2% to $230.7 billion in July. This increase follows a 1.6% increase in June. Excluding volatile transportation-related goods, July orders posted a monthly decrease of 0.4%.

Initial claims for unemployment benefits for the week ending August 18 rose by 4,000 to 372,000 from an upwardly revised 368,000 the prior week. Continuing claims for the week ending August 11 also rose by 4,000 to 3.317 million.

from Prospect Mortgage Economic Update

Enhanced by Zemanta

Last Week in the News

The National Association of Home Builders/Wells Fargo monthly housing market index rose two points in August to 37, the highest level since February 2007. An index reading below 50 indicates negative sentiment about the housing market.

The producer price index, which tracks wholesale price inflation, rose 0.3% in July, following a 0.1% increase in June. On a year-over-year basis, wholesale prices were up 0.5% in July. Core prices — excluding food and fuel — rose 0.4% in July.

Retail sales rose 0.8% to $403.9 billion in July. This follows a revised 0.7% decrease in June. On a year-over-year basis, retail sales increased 4.1% in July.

The Mortgage Bankers Association said its seasonally adjusted composite index of mortgage applications for the week ending August 10 fell 4.5%. Refinancing applications decreased 5%. Purchase volume fell 2%.

Consumer prices were unchanged in July, following a flat reading in June. Compared to a year ago, consumer prices are up 1.4% in July. Consumer prices at the core rate — excluding volatile food and energy prices — were up 0.1% in July.

The combined construction of new single-family homes and apartments in July fell 1.1% to a seasonally adjusted annual rate of 746,000 units. Single-family starts decreased 6.5%. Volatile multifamily starts rose 12.4%. Compared to a year ago, housing starts are up 21.5% in July. Applications for new building permits, seen as an indicator of future activity, rose 6.8% to an annual rate of 812,000 units.

Initial claims for unemployment benefits for the week ending August 11 rose by 2,000 to 366,000 from an upwardly revised 364,000 the prior week. Continuing claims for the week ending August 4 fell 31,000 to 3.305 million.

from Prospect Mortgage Economic Update

Enhanced by Zemanta

Last Week in the News

The Standard & Poor’s/Case-Shiller 20-city housing price index — on a non-seasonally adjusted basis — rose 2.2% in May, following a 1.3% increase in April. On a year-over-year basis, prices fell 0.7% compared with May 2011.

The Bureau of Economic Analysis reported that personal income increased $61.8 billion or 0.5% in June. Consumer spending was flat in June, following a 0.1% decrease in May.

The Mortgage Bankers Association said its seasonally adjusted composite index of mortgage applications for the week ending July 27 rose 0.2%. Refinancing applications increased 0.8%. Purchase volume fell 2%.

Manufacturing activity rose to 49.8 in July after a reading of 49.7 in June. A reading below 50 signals contraction. This was the second consecutive contraction since July 2009.

Total construction spending rose 0.4% to $842.1 billion in June from an upwardly revised 1.6% increase in May. Compared to June 2011, construction spending is up 7%.

Factory orders fell 0.5% in June to a seasonally adjusted $465.8 billion, following a revised 0.5% increase in May. Excluding the volatile transportation sector, orders decreased 1.8% in June.

Non-manufacturing activity rose to 52.6 in July from 52.1 in June. A reading above 50 signals expansion. It was the 31st straight month of expansion in the services sector.

Initial claims for unemployment benefits for the week ending July 28 rose by 8,000 to 365,000 from an upwardly revised 357,000 the prior week. Continuing claims for the week ending July 21 fell 19,000 to 3.272 million. The unemployment rate rose to 8.3% in July from 8.2% in June. Employers added 163,000 jobs in July.

from Prospect Mortgage Economic Update

 

Enhanced by Zemanta

Last Week in the News

The Institute for Supply Management reported that the monthly composite index of manufacturing activity rose to 53.4 in March after a reading of 52.4 in February. A reading above 50 signals expansion. It was the 32nd straight month of expansion.

Total construction spending fell 1.1% to $808.9 billion in February from a revised $818.1 billion in January. Economists had anticipated an increase of 0.7% in February. Compared to a year ago, construction spending is up 5.8%.

Retail sales fell 3.8% for the week ending March 31, according to the ICSC-Goldman Sachs index. On a year-over-year basis, retailers saw sales increase 4.2%.

Factory orders rose 1.3% in February to a seasonally adjusted $468.4 billion, following a revised 1.1% decrease in January. Excluding the volatile transportation sector, orders increased 0.9% in February.

The Mortgage Bankers Association said its seasonally adjusted composite index of mortgage applications for the week ending March 30 rose 4.8%. Refinancing applications increased 4%. Purchase volume rose 7.2%.

The Institute for Supply Management reported that the monthly composite index of non-manufacturing activity fell to 56 in March from 57.3 in February. A reading above 50 signals expansion. It was the 27th straight month of expansion in the services sector.

Initial claims for unemployment benefits for the week ending March 31 fell by 6,000 to 357,000. Continuing claims for the week ending March 24 fell by 16,000 to 3.33 million. The monthly unemployment rate fell to 8.2% in March, the lowest level since January 2009.

from Prospect Mortgage Economic Update

Enhanced by Zemanta