We’re seeing a continuation of the trend of improving mortgage rates. According to Freddie Mac’s latest survey of average rates, the rate for a 30-year fixed-rate mortgage fell for the fourth straight week. This is welcome news to those eager to jump on the bandwagon for spring home-buying season. However, there are still challenges buyers may be facing in the market like the low inventory of homes for sale.
Friday’s Jobs Report was a surprise as the job market showed signs of slowing job growth, adding the fewest number of jobs in the past 12 months. New job creation hit 236,000, considered healthy growth but below the 326,000 created the month prior.
The Jobs Report also revealed wage inflation continues its upward trend as the unemployment rate improved slightly to 3.5 percent.
As for homebuyer sentiment, Fannie Mae released research this week that revealed the majority of people surveyed believe it’s not a good time to buy, however, the number of people that believe it’s a good time to sell is increasing.
In more current research, the volume of new mortgage loans locked in increased by 44 percent in March, well above the February to March gain of 30 percent. Even cash-out refinance activity rose by 31 percent. As we know, this is a rate-sensitive housing market but we are seeing the seasonal trends that are favorable.
As for what I’m watching this week…
A couple of key inflation reports are due out this week and are sure to be attention grabbers. The first is the CPI (Consumer Price Index). Core prices in March are expected to rise an elevated 0.4 percent versus February’s sharp and higher-than-expected increase of 0.5 percent. Annual rates, which in February were 6.0 percent overall and 5.5 percent for the core, are expected at 5.2 and 5.6 percent.
Closely following the report on consumer prices is the report on wholesale price inflation. After edging 0.1 percent lower on the month in February, producer prices in March are expected to hold unchanged. If true to predictions, this could be a good harbinger for moderating inflation.
Friday’s report on Retail Sales is always an interesting report to watch as two-thirds of our economic activity comes from our retail sector. March sales are expected to fall 0.4 percent for the second month in a row.
I’ll keep an eye on it all and report back!
