Happy New Year! As we head into 2017, we want to make sure we’re keeping our clients, borrowers and real estate agent friends up to date on the mortgage market. Spring is just around the corner, so be sure to take note of how rates and home prices are moving — this spring home buying season could be one for the books, especially in Texas!
Major Texas markets like the Dallas-Fort Worth area, continue to show robust growth. And with mortgage rates expected to rise slightly throughout the year, we’re approaching a time where buying a home in Texas won’t be as inexpensive as we’d seen in years past. That being said, affordability should maintain strength as our economy is poised to continue building the job market and Texas’ industries continue to grow. In addition, the recent announcement that the FHA is going to reduce its annual Mortgage Insurance Premium makes the low money down loan option even more accessible to budget-conscious buyers.
Are you thinking of buying a home this spring? Explore the financing options available, including affordable FHA loans, and talk to us about locking in a low Texas mortgage rate.
Speaking of mortgage rates, let’s take a look at the current trends.
Rates Currently Trending: Neutral
Mortgage rates are trending very slightly better this week. Last week the MBS market improved by +12 bps. This wasn’t enough to improve mortgage rates or fees. Mortgage rates experienced high volatility yesterday, but should remain at an average level throughout the week.
This Week’s Rate Forecast: Neutral
There are three big events of the week that will have the greatest ability to impact mortgage rates: 1.) The Talking Fed. 2.) Across the Pond. And 3.) Domestic Flavor.
1.) The Talking Fed
We will get commentary from the Fed this week with the spotlight on Janet Yellen:
- 01/09 Eric Rosengren and Dennis Lockhart.
- 01/12 Charles Evans, Pat Harker, Dennis Lockhardt, James Bullard and Janet Yellen.
2.) Across the Pond
We have large amounts of very important data out of China (world’s number 2 economy) with Imports/Exports, PPI and CPI. Germany (world’s number 4 economy and the driving force for the Eurozone) will have a very important 10Y bond auction, Industrial Production, Real GDP and Wholesale Trade. The Brexit will continue to gain a lot of attention as Prime Minister May makes comments on the timing and desired type of post-EU existence for Great Britain.
3.) Domestic Flavor
The biggest report of the week will be Friday’s Retail Sales data. We already know from last week’s Total Vehicle Sales data that Auto Sales will be strong, so we will focus on the Retail Sales Ex-Auto. We also get some inflationary data with PPI, more jobs data as well with the LMCI, JOLTS and Weekly Claims.
This Week’s Potential Volatility: Average
While mortgage rates were relatively volatile last week, we’re starting to build a nice little channel for mortgage rates. We don’t expect mortgage rates to move significantly higher or lower this week. Of course, any unforeseen event can change that. Mortgage rates are subject to change at any time and can sometimes change more than once in a single day.
The Bottom Line:
If you’re a home buyer looking to lock in on a mortgage rate this week, discuss it with your lending professional. Compare the risks and benefits of locking your rate today or floating the rate.