Mortgage Rates-Best Year

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Short term locking mortgage Rates ahead of the long weekend. Longer term Floating Mortgage Rates.

The capital markets were quiet today ahead of the extended holiday weekend. The markets are closed on Monday in observance of Martin Luther King Day. The 3% coupon rose by 22bp with most of the gains occurring earlier in the session and traded in a narrow range for most of the trading day finishing at 104.12. Stock also had a lackluster day and traded near unchanged throughout the day but the Dow and the S&P 500 did manage to finish with gains while the Nasdaq was capped by a decline in shares of Apple. The Dow rose by 53.68 points to 13,649.70, the S&P 500 rose 5.04 points to 1,458.98 while the Nasdaq fell by 1.30 points to end at 3,134.71. Oil was last seen at $95.29/barrel down 20 cents.

Mortgage Applications Jump 15.2% 

Refinancing applications increased 15% from a week ago, while the seasonally adjusted purchase index climbed 13%, the Mortgage Bankers Association said.

2013 Follows Best Year in 7 Decades
2012 Was the Best Year For Mortgage Rates Since Just After World War II!
Therefore, 2013 would have to be a remarkable year in order to match that feat.  Various forecasts for mortgage rates for the upcoming year have been published by major economists and housing-related organizations.  The consensus appears to be that mortgage rates will likely be higher by the end of 2013 than when it began.  Most also agree that rate increases will neither be rapid nor steep enough to fundamentally change the affordability of homeownership for those who don’t currently own a home. However, for those who might benefit from a refinancing of an existing mortgage the news of potentially higher rates down the road should prompt action.  With rates on the 30 and 15 year-fixed mortgage loans still near all-time loans as we begin 2013, the time may never be better to lock-in savings for the future.
According to Frank Nothaft, vice president and chief economist, Freddie Mac: “Mortgage rates ended this year near record lows. The 30-year fixed-rate mortgage averaged 3.66 percent for 2012, the lowest annual average in at least 65 years. Rates on 30-year fixed mortgages were nearly 0.6 percentage points below that of the beginning of the year, which translates into an interest payment savings of nearly $98,600 over the life of a $200,000 loan.”
Home Prices Up The Most Since 1996

Home prices nationwide, including distressed sales, grew 7.4% year-over-year in November, representing the largest annual gain since May 2006, according to the latest Home Price Index report from CoreLogic. This change represents the ninth consecutive month of year-over-year price gains and the largest increase since May 2006.

Housing Starts Rise 12.1%

U.S. homebuilders presumably ended 2012 on a high note, with data showing housing starts jumping 12.1% from November to December, the Department of Commerce said.

Furthermore, housing starts – a measure of new construction activity – grew 36.9% from the previous December, backing up widespread reports of blooming homebuilder confidence.

In December alone, the U.S. recorded 954,000 new home starts, up from 851,000 starts in November and a significant increase from 697,000 starts a year earlier. Economists with MarketWatch noted December housing starts reached a level not seen since June 2008.

Completed construction also grew in December. The nation saw 686,000 homes completed last month, up from 675,000 units in November and a rise of 13.2% when compared to the 606,000 properties completed in December 2011.

 

Economic News

The Commerce Department reported this morning that Retail Sales in December rose by 0.5%, above the 0.2% expected – thanks to a big holiday shopping boost.  Consumer spending, which accounts for a large portion of our GDP still remains tepid overall.

 

 Sources: Bloomber, Mtg Master, MMG, Housing Wire, CNBC

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