The strengthening economy and elevated inflation pushed mortgage rates slightly higher last week, according to Freddie Mac’s weekly survey.
“Mortgage rates have risen above three percent for the first time in ten weeks,” said Sam Khater, Freddie Mac’s Chief Economist. “…we expect that rates will continue to gradually rise in the second half of the year. For those homeowners who have not yet refinanced – and there remain many borrowers who could benefit from doing so – now is the time.”
You may be able to refinance out of Mortgage Insurance based on the rising property values and the loan to value ratio for your home. Get in touch with me ASAP and let’s look at your specific scenario! You can simply reply to this email or call/text me at 818.307.6072.
This week I’m watching…
Friday’s Jobs Report is likely to be the biggest market mover, especially as wage inflation is expected to rise. As we know inflation can cause mortgage rates to rise, so I’ll be keeping a close eye on how this report affects markets.
As for the rest of the Jobs Report, a rise of 675,000 is the consensus for June job creation following lower-than-expected increases of 559,00 in May and 278,000 in April. Job growth in the US appears to be falling short of recovery in general demand.
There are also a couple important home price appreciation numbers due out. Case-Shiller’s home price index, which has been tracking near record levels, beat expectations rising 1.6 percent in the month of April. The annual rate rose and outsized 14.9 percent versus 13.3 percent in March. The FHFA report on home price appreciation reported a 15.7 percent annual increase in prices. Home prices continue to rise as inventory remains tight.
Wednesday we begin to see the employment reports come out. The first is ADP’s report on private sector job creation. The consensus forecast for ADP’s June number is 533,000.
Pending home sales – a leading indicator of home sales figures – have come in below the consensus range for the last four reports. After April’s 4.4 percent monthly decline, forecasters see the index falling another 1.0 percent in May.
Also a leading indicator, construction spending in May is expected to rise 0.5 percent following April’s lower-than-expected 0.2 percent gain, one that was held back once again by extended weakness in non-residential construction.