Following the strong jobs report and the Fed’s interest hike that I wrote about in last week’s update, it’s no surprise that mortgage rates moved higher in the most recent survey of average mortgage rates by Freddie Mac.
According to Sam Khater, Freddie Mac’s Chief Economist. “The 30-year fixed-rate continues to hover close to six percent, and interested homebuyers are easing their way back to the market just in time for the spring homebuying season.”
This week the high-impact economic data continued with the latest report on Consumer Inflation (CPI) showing overall prices rose a touch more than expected by 0.5 percent to offset December’s 0.1 percent decline. Annual rates, at 6.5 percent overall in December, continued to moderate to 6.4, again a little higher than expected, however still lower than the prior month.
On the heels of the Consumer Price Index (CPI), we get a look at wholesale inflation on Thursday. Producer prices (PPI) in January are expected to rise 0.4 percent on the month for a year-over-year increase of 5.5 percent which would compare with 6.2 percent in December.
As far as housing news, the Housing Marketing Index, a monthly composite that tracks home builder assessments of present and future sales as well as buyer traffic comes out later this week. After falling each month in 2022, the housing market index ended the dismal streak in January, up 4 points to 35. February’s consensus is a further 2-point improvement to 37.
Another leading indicator of how the housing market is shaping up for the peak spring season is the report on New Housing Projects and Building Permits that we’ll see later this week. January’s annualized rates are expected slightly lower at 1.36 million for starts and 1.35 for permits which would compare with 1.38 and 1.33 million in December. Starts and permits have been steadily lower.
After nine months of declines, we’re starting to see the data showing mortgage origination activity rising. In fact, a recent report from Black Knight reports activity to lock in a mortgage rate rose 32 percent, driven by the improvement in rates and the seasonal time of year.
Are you looking to be one of the early buyers in the Spring? If so, now’s a great time to get working on your plan with me. Let’s run your numbers and see what the best scenarios look like for you so I can monitor rates for you. Call/text me today at 818.307.6072 or reply to this email.
