This week’s mortgage market update has some exciting news for the home building industry while home buyers will be glad to hear that mortgage rates are likely to remain neutral.
Home Builder Sentiment Hits Six Month High
Home builder sentiment, or how home builders feel about the home construction market, has risen to a six month high according to data from the National Association of Home Builders (NAHB). The monthly sentiment index from NAHB jumped 4 points in July to a total level of 53, finally climbing over the threshold of 50, which is the line between positive and negative sentiment.
“This is the first time that builder confidence has been above 50 since January and an important sign that it is strengthening as pent-up demand brings more buyers into the marketplace,” said NAHB Chairman Kevin Kelly, a home builder and developer from Wilmington, Delaware.
In further good news, employment seems to be improving while low levels of existing homes for sale adds to the demand for new construction.
“An improving job market goes hand in hand with a rise in builder confidence,” said NAHB Chief Economist David Crowe. “As employment increases and those with jobs feel more secure about their own economic situation, they are more likely to feel comfortable about buying a home.”
Mortgage Rates At-A-Glance
- Currently Trending: Neutral
- 7 Day Rate Forecast: Neutral
- Potential Volatility: High
Mortgage rates are continuing to trend fairly neutral, with little change from day to day. The overall improvement for last week for the Mortgage Backed Securities (MBS) market was +2 basis points, which may mean mortgage pricing finished close to where it started.
The forecast for the remainder of the week is also neutral, with market technical indicators pointing to neutral as well as data from Sigma Research. However, volatility is going to be high due to economic data coming out later this week. The data is likely to have an effect on the bond market, while issues overseas will probably play a strong role as well. Any geopolitical news can have a significant effect on financial markets and the mortgage market is no exception. That’s why keeping up with the latest economic and political news can be beneficial for consumers and soon-to-be home buyers. While there’s really no guarantee whether rates will go up, down or stay put, it can be easier to predict where rates will trend if you know how the market reacts to certain events.
Even if you’re not able to keep up with the latest market information, your mortgage lender should be able to help you determine a good time to lock in a rate. Developing a rate lock/float strategy with your mortgage consultant can be in your best interest, as your lender will likely have their finger on the pulse of the market.
For more information, be sure to contact a professional home loan expert serving your area. If you’re buying or refinancing a home in the great state of Texas, feel free to reach out to Kelly Decker and his team of mortgage professionals for a free rate quote and mortgage consultation. Just call (972) 591-3097.