MBS prices are on the climb this morning (FNMA 4.00 +9/32), on bond-friendly data, and perhaps some reaction to talk of a bailout in Ireland. Consumer Price data (CPI 0.2% vs. 0.3% est., Core CPI 0.0% vs. 0.1% est.) showed no signs of immediate consumer inflation pressure, and the housing data was worse than expected. Both Housing Starts (519k vs. 600k est.) and Building Permits (550k vs. 570k est.) were below expectations. Adding fuel to the rally is word that European finance officials are headed to Ireland to discuss bailout packages for the struggling EU member. The stock market is basically flat (Dow +5.30, S&P +3.76). Keep an eye on the headlines for further news out of Europe, and for any inflation-related topics.
Tomorrow, Thursday, 11/18 has Initial Jobless Claims (est. 442k), Leading Indicators (est. 0.6%), and the Philadelphia Fed (est. 5.0). Initial Claims will be watched for further signs of life in the jobs sector, so expect a lower than expected print to potentially send rates higher, while an up-side miss may allow rates to continue dropping. The Philly Fed is usually a market-mover. Look for a higher than expected reading to spur selling (rates up), while a disappointing number may allow rates to stay low.
Wednesday, November 17, 2010
Tuesday, November 16, 2010
Interest Rates
Rates on 30-year fixed mortgages rose slightly from their lowest level in decades, inching up to a national average of 4.21 percent.
Mortgage buyer Freddie Mac says the average rate for 30-year fixed loans was up from 4.19 percent the previous week. That was the lowest level on records dating back to 1971.
The average rate on 15-year fixed loans rose to 3.64 percent. That was up from 3.62 percent a weak earlier, the lowest weekly average on records dating back to 1991.
Rates have been falling since April. The latest declines are largely because investors have been buying up Treasury bonds in anticipation of the Federal Reserve's likely move to buy Treasury's to stimulate the economy. That demand lowers Treasury yields, which mortgage rates tend to track.
Low rates haven't helped the struggling housing market, which recorded its worst summer in more than a decade. But they have led to a modest surge in refinancing.
To calculate average mortgage rates, Freddie Mac collects rates from lenders around the country on Monday through Wednesday of each week. Rates often fluctuate significantly, even within a given day.
Rates on five-year adjustable-rate mortgages averaged 3.45 percent, up from 3.47 percent a week earlier. Rates on one-year adjustable-rate mortgages fell to an average of 3.3 percent from 3.43 percent.
The rates do not include add-on fees known as points. One point is equal to 1 percent of the total loan amount. The nationwide fee for loans in Freddie Mac's survey averaged 0.8 a point for 30-year. It averaged 0.7 of a point for 15-year and 1-year mortgages and 0.6 of a point for 5-year mortgages.
Mortgage buyer Freddie Mac says the average rate for 30-year fixed loans was up from 4.19 percent the previous week. That was the lowest level on records dating back to 1971.
The average rate on 15-year fixed loans rose to 3.64 percent. That was up from 3.62 percent a weak earlier, the lowest weekly average on records dating back to 1991.
Rates have been falling since April. The latest declines are largely because investors have been buying up Treasury bonds in anticipation of the Federal Reserve's likely move to buy Treasury's to stimulate the economy. That demand lowers Treasury yields, which mortgage rates tend to track.
Low rates haven't helped the struggling housing market, which recorded its worst summer in more than a decade. But they have led to a modest surge in refinancing.
To calculate average mortgage rates, Freddie Mac collects rates from lenders around the country on Monday through Wednesday of each week. Rates often fluctuate significantly, even within a given day.
Rates on five-year adjustable-rate mortgages averaged 3.45 percent, up from 3.47 percent a week earlier. Rates on one-year adjustable-rate mortgages fell to an average of 3.3 percent from 3.43 percent.
The rates do not include add-on fees known as points. One point is equal to 1 percent of the total loan amount. The nationwide fee for loans in Freddie Mac's survey averaged 0.8 a point for 30-year. It averaged 0.7 of a point for 15-year and 1-year mortgages and 0.6 of a point for 5-year mortgages.
Rules to follow when Selling a Home
Rules to Follow when Selling a Home
Clean out the "clutter." Open spaces look best. Clean, and clean some more, to make a good first impression.
"Spiff up" the property. Make any improvements that will enhance the "Showing Value" of your home. When possible, stick with simpler, less expensive options to be sure the selling price covers your investment.
Determine the worth. Determine the fair market value of your home. I can help assess the cost, though you may also want to have the home appraised.
Price it "right." I can help you objectively set the price so it reflects the value of your home and is inline with the trends of the surrounding community.
Develop a "plan." Are you eager to move? How low are you willing to go to sell?
Get pre-approved for your next move. If you're looking to buy another house, make sure you know your financial situation.
Figure out your selling costs: Commission, advertising, closing etc. I deal with transactions like this every day and can give you a very close estimate of the seller closing costs.
Set the stage. Clean the windows, open the curtains, turn on the lights, and display fresh flowers. A bright house is a warm and welcoming house.
It's "Show Time!" Be ready and willing to show your home on any day or evening, even with short notice. Keep the house "ready."
Clean out the "clutter." Open spaces look best. Clean, and clean some more, to make a good first impression.
"Spiff up" the property. Make any improvements that will enhance the "Showing Value" of your home. When possible, stick with simpler, less expensive options to be sure the selling price covers your investment.
Determine the worth. Determine the fair market value of your home. I can help assess the cost, though you may also want to have the home appraised.
Price it "right." I can help you objectively set the price so it reflects the value of your home and is inline with the trends of the surrounding community.
Develop a "plan." Are you eager to move? How low are you willing to go to sell?
Get pre-approved for your next move. If you're looking to buy another house, make sure you know your financial situation.
Figure out your selling costs: Commission, advertising, closing etc. I deal with transactions like this every day and can give you a very close estimate of the seller closing costs.
Set the stage. Clean the windows, open the curtains, turn on the lights, and display fresh flowers. A bright house is a warm and welcoming house.
It's "Show Time!" Be ready and willing to show your home on any day or evening, even with short notice. Keep the house "ready."
Wednesday, November 10, 2010
November 10, 2010 mortgage rates outlook
MBS prices are down on the session (FNMA 3.50 -11/32), in volatile trade. The stock market is down as well (Dow -45.07, S&P -3.39). Weekly Initial Jobless Claims came in better than expected (435k vs. 450k est.), as did the Trade Balance ($-44.0B vs. -$44.8B est.). Import Prices were in-line with the previous reading, but Export Prices were up a bit. The data did not hit MBS prices immediately, but may be contributing to the current sell-off. That said, inflation fears are likely behind most of the recent increase in rates. While most foreign countries approved of the US Fed's initial round of quantitative easing, the recent announcement of the 2nd round of QE (aka QEII) has elicited criticism from around the globe. In 2009, fears were of deflation and rampant unemployment, but fears seem to be turning to inflation. Many investors are of the opinion that QE has a lagging impact, so we are yet to see the full effect of QEI, and that we should be fearful that further easing may stoke the flames of inflation. There are clearly opinions on both sides of this argument, but only time will tell the true impact of these unprecedented moves by the Fed. Throughout all of this, keep in mind that the Fed has a dual mandate, meaning that they are tasked with ensuring two things: 1) maximum US Employment, and 2) price stability. The Fed will employ all sorts of measures to accomplish these goals, lowering/raising rates and quantitative easing are two major measures for spurring business investment, and thus theoretically creating jobs. Manipulating rates via the Fed Funds rate had always been a strong lever used by the Fed, but as we know, the Fed Funds rate has been set near zero since the recession took hold, so QE has become their method of keeping rates low. Critics of QE argue that by purchasing government bonds, the Fed is basically printing money out of nothing. This practice, on its face, may lead to inflation, as more dollars exist in the market, for which there may be diminishing demand. These same critics believe that eventually, buyers of dollars and dollar denominated assets (stocks bonds) may dump these assets as they become wary of US-led inflation. This flight away from dollar assets would send rates higher. The Fed would then need to raise rates to address the mandate of price stability. This is likely the fear behind allot of the recent negative bond market moves.
Tomorrow, Thursday, 11/11 is Veteran's Day. No economic data will be released, and the bond markets will be closed. Just a reminder, WJB (including the lock desk) is open for normal business hours tomorrow.
Tomorrow, Thursday, 11/11 is Veteran's Day. No economic data will be released, and the bond markets will be closed. Just a reminder, WJB (including the lock desk) is open for normal business hours tomorrow.
New Real Estate Law effective January 1, 2011
Stop New Requirements to Buy Property!
ISSUE:
The Nevada Energy Commissioner is currently receiving written comments on R148-10, a regulation stemming from legislation passed in 2007. The legislation established that a seller must provide a 12-month average of the utility bill to a prospective buyer, to inform buyers of energy costs associated with purchasing a home. This law becomes effective on January 1, 2011. The regulation as currently proposed accurately reflects the intent and letter of the law, and NVAR is fully supportive of the work done by the Commissioner.
Unfortunately, some entities believe that a comprehensive energy audit should be conducted at point of sale. This is a big concern for our clients and customers, as this could pose excessive and unnecessary delays in the transfer of property, as well as add to the cost of acquiring real property.
NVAR's POSITION:
The Nevada Association of REALTORS® opposes any requirements that are tied to real estate transactions. Any encumbrance on the sale of property delays escrows, increases the cost of homeownership, and increases the time to sell a home.
ACTION NEEDED:
•The Nevada Energy Commissioner is currently receiving written comments on R148-10.
•Please submit your written comments to the Nevada Energy Commissioner in support of the regulation as written, and opposing any requirements tied to the transfer of property to protect our economy and our real estate market.
Send a letter to the following decision maker:
•Hatice Gecol
Below is the sample letter:
Message Subject: **Comments on R148-10**
Dear [Decision Maker],
I am writing to you in support of R148-10 as presented.
In 2007, the Senate Committee on Commerce and Labor introduced legislation that would have required a comprehensive energy audit at point of sale and rated the property on its energy efficiency. The Nevada Association of REALTORS® opposed this requirement. Nevada does not require any inspections at point of sale, and this would have been the only required inspection if it had passed as originally introduced.
In working with Senator Townsend and the other interested parties, an agreement was reached to allow the seller of the property to provide a 12-month average of the utility bill to give the buyer an idea of what the energy consumption of the home might be. In addition, the buyer and seller also have an option to waive this requirement.
As a REALTOR®, I am supportive of the regulation as drafted by the Nevada Renewable Energy and Energy Efficiency Authority. It accurately reflects the agreement that was reached by all parties involved during the 2007 Session. The State of Nevada is in a tough economic position. Putting any additional burdens on sellers of real property will have a negative impact on the housing market.
I am asking you to approve R148-10 as drafted. It accurately reflects the agreement that was reached in 2007 between all parties involved.
ISSUE:
The Nevada Energy Commissioner is currently receiving written comments on R148-10, a regulation stemming from legislation passed in 2007. The legislation established that a seller must provide a 12-month average of the utility bill to a prospective buyer, to inform buyers of energy costs associated with purchasing a home. This law becomes effective on January 1, 2011. The regulation as currently proposed accurately reflects the intent and letter of the law, and NVAR is fully supportive of the work done by the Commissioner.
Unfortunately, some entities believe that a comprehensive energy audit should be conducted at point of sale. This is a big concern for our clients and customers, as this could pose excessive and unnecessary delays in the transfer of property, as well as add to the cost of acquiring real property.
NVAR's POSITION:
The Nevada Association of REALTORS® opposes any requirements that are tied to real estate transactions. Any encumbrance on the sale of property delays escrows, increases the cost of homeownership, and increases the time to sell a home.
ACTION NEEDED:
•The Nevada Energy Commissioner is currently receiving written comments on R148-10.
•Please submit your written comments to the Nevada Energy Commissioner in support of the regulation as written, and opposing any requirements tied to the transfer of property to protect our economy and our real estate market.
Send a letter to the following decision maker:
•Hatice Gecol
Below is the sample letter:
Message Subject: **Comments on R148-10**
Dear [Decision Maker],
I am writing to you in support of R148-10 as presented.
In 2007, the Senate Committee on Commerce and Labor introduced legislation that would have required a comprehensive energy audit at point of sale and rated the property on its energy efficiency. The Nevada Association of REALTORS® opposed this requirement. Nevada does not require any inspections at point of sale, and this would have been the only required inspection if it had passed as originally introduced.
In working with Senator Townsend and the other interested parties, an agreement was reached to allow the seller of the property to provide a 12-month average of the utility bill to give the buyer an idea of what the energy consumption of the home might be. In addition, the buyer and seller also have an option to waive this requirement.
As a REALTOR®, I am supportive of the regulation as drafted by the Nevada Renewable Energy and Energy Efficiency Authority. It accurately reflects the agreement that was reached by all parties involved during the 2007 Session. The State of Nevada is in a tough economic position. Putting any additional burdens on sellers of real property will have a negative impact on the housing market.
I am asking you to approve R148-10 as drafted. It accurately reflects the agreement that was reached in 2007 between all parties involved.
Wednesday, November 3, 2010
Elections
Another year of elections have now surrendered and we find ourselves with more of equal balance of democrates and republicans. The issue for me is not the election itself but the process inwhich we are expected to make rationale decisions on which candidate to vote for. I never saw a commerical that stated what the candidate would do and focus on, but wow, did we see have enough commercials slamming the oppenent to the point of making you want to pull your hair out.
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