Archive for November, 2013

Mortgage Time…better late than never!

November 25, 2013
MORTGAGE TIME
Mortgage Market News for the week of Nov. 22, 2013
Compliments of
Patrick Gardner
Mortgage Loan Officer
NMLS ID: 378888
415-423-1424
Email me
Visit my website

FED MINUTES REVEAL SPLIT
Once again, the biggest influence on mortgage rates was shifting sentiment about future Fed policy. The Fed Minutes and statements from Fed officials caused investors to move forward their expected timing for scaling back the bond purchase program. As a result, mortgage rates ended the week a little higher.

The Minutes from the October 30 Fed meeting released this week revealed a great deal of disagreement among Fed officials about when to change policy. Just last week, testimony from the nominee for the next Fed Chief, Janet Yellen, encouraged investors that the Fed will not begin to scale back its bond purchases any time soon. In contrast, what emerged from the Minutes is that a number of Fed officials expect improvement in the labor market to warrant tapering to begin “in coming months.” The added demand for mortgage-backed securities (MBS) from the Fed has been a major factor in keeping mortgage rates low, and any signs that the Fed may begin to taper either sooner or later have consistently caused significant movement in mortgage rates. The unexpectedly hawkish tone of the Fed Minutes offset the dovish comments from Yellen, leaving mortgage rates roughly unchanged over the two-week period.

The October Existing Home Sales report released this week showed a drop of 3% from September. There were a number of reasons for the decline, including the government shutdown which took place during the first half of the month. Even with the decline in October, Existing Home Sales were still 6% higher than one year ago. The housing sector has been an important source of strength for the economy this year, so investors will be closely watching next month’s data.

ALSO NOTABLE
Core CPI inflation was just 1.7% higher than one year ago
Retail Sales showed healthy gains in October
The Dow stock index climbed to a record high above 16,000
Gold prices declined to a four-month low

WEEK AHEAD
Next week, Pending Home Sales will be released on Monday. Housing Starts and Consumer Confidence will come out on Tuesday. Durable Orders, Chicago PMI, and Consumer Sentiment will be released on Wednesday. In addition, there will be Treasury auctions on Monday, Tuesday, and Wednesday. Mortgage markets will be closed on Thursday in observance of Thanksgiving and will close early on Friday. Enjoy your holiday!

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On the fence about Purchasing a Home?

November 19, 2013
PURCHASING A HOME AND POCKET THE PERKS
Since you’re thinking of purchasing a new home, I thought it would be a great time to pass along some of the financial benefits of home ownership:

Mortgage interest and property taxes are usually 100% deductible
Homes typically appreciate over time
Builds equity
Increases borrowing power since a home’s equity is typically used to secure other loans or lines of credit

These are just a few of the financial perks of owning a home—there are plenty more. I’m ready to assist you to get into your new home, so when the time is right, feel free to get in touch.

Patrick Gardner
Mortgage Loan Officer
415-423-1424
Patrick.Gardner@EverBank.com
NMLS ID: 378888
Visit my website

MORTGAGE TIME

November 16, 2013
MORTGAGE TIME
Mortgage Market News for the week of Nov. 15, 2013
Compliments of
Patrick Gardner
Mortgage Loan Officer
NMLS ID: 378888
415-423-1424
Email me
Visit my website

DOVISH STATEMENTS FROM YELLEN
During a light week for economic data, the biggest influence on mortgage rates was testimony from Janet Yellen. Yellen, the nominee to be the next Fed Chief, revealed strong support for the Fed’s bond buying program. This news helped mortgage rates end the week lower.

Janet Yellen testified this week at her confirmation hearing to replace Ben Bernanke as the Chair of the Fed. Essentially she stated that the Fed will continue the policies currently in place. She emphasized that the Fed’s monetary stimulus is appropriate to help boost the economy. According to Yellen, Fed officials are looking for signs of sustainable economic growth which will “promote continued progress” before they begin to scale back the Fed’s bond purchases. In short, her comments suggested that the Fed is in no rush to tighten monetary policy.

Investors viewed Yellen’s dovish comments as good news for both stocks and bonds. At its current pace, the Fed is purchasing the majority of newly issued mortgage-backed securities (MBS) each month. Since mortgage rates are determined in large part by MBS prices, this enormous added demand from the Fed for MBS has helped keep mortgage rates low. Economic news which causes investors to shift their outlook for the bond buying program causes a significant reaction in mortgage markets, as seen following last Friday’s stronger than expected Employment report.

ALSO NOTABLE
Jobless Claims held steady at levels below 350K
The Dow stock index climbed to a record high
The results were mixed for this week’s Treasury auctions
Third quarter GDP in the euro zone increased just 0.1%

WEEK AHEAD
The most significant economic data next week will be the Retail Sales data and the monthly inflation reports. Retail Sales account for about 70% of economic activity and will be released on Wednesday. The Consumer Price Index (CPI), the most closely watched monthly inflation report, also will come out on Wednesday. CPI looks at the price change for finished goods which are sold to consumers. The Producer Price Index (PPI) focuses on the increase in prices of “intermediate” goods used by companies to produce finished products and will come out on Thursday. In addition, Existing Home Sales will be released on Wednesday and Philly Fed will come out on Thursday. The Minutes from the October 30 Fed Meeting will be released on Wednesday. These detailed Minutes provide additional insight into the debate between Fed officials.

http://www.bizjournals.com/sanfrancisco/blog/real-estate/2013/11/orinda-new-homes-construction-boom.html?iana=ind_rre

November 11, 2013

http://www.bizjournals.com/sanfrancisco/blog/real-estate/2013/11/orinda-new-homes-construction-boom.html?iana=ind_rre

It’s that time again!….Mortgage Time

November 8, 2013
MORTGAGE TIME
Mortgage Market News for the week of Nov. 8, 2013
Compliments of
Patrick Gardner
Mortgage Loan Officer
NMLS ID: 378888
415-423-1424
Email me
Visit my website

JOB GAINS SURGE
This week was packed with major economic reports and a Fed meeting. With investors looking for hints about when the Fed will begin to taper its bond purchases, the data caused a great deal of volatility. Because the economic news was roughly neutral overall, though, mortgage rates ended the week just slightly higher.

A shockingly strong Employment report caused a swift increase in mortgage rates on Friday. Against a consensus forecast of 120K, the economy added 204K jobs in October, and the figures from the prior two months were revised higher by 60K. The Unemployment Rate, however, rose from 7.2% to 7.3%. The increase in the Unemployment Rate was influenced by the government shutdown during the first half of October. The headline figure of 204K jobs is based on a survey which counts furloughed government workers as employed, while the Unemployment Rate is based on a different survey which counts them as unemployed. Before the data, most investors had expected that the Fed would begin to taper its bonds purchases in March or April. If the pace of job creation continues at this level, though, the Fed could begin to scale back sooner.

In similar fashion, the Gross Domestic Product (GDP) report, the broadest measure of economic growth, was much better than expected. Third quarter GDP rose to 2.8%, well above the consensus of 2.0%. The reaction in mortgage markets was somewhat limited, though, since the details did not quite indicate the same strength as the headline number. Part of the outperformance was due to an unexpectedly large increase in inventories, which means that some growth was “pulled forward” from the fourth quarter. The extra goods produced during the third quarter which caused inventories to expand will reduce production in the fourth quarter.

ALSO NOTABLE
Core PCE inflation was just 1.2% higher than one year ago
Consumer Sentiment declined to the lowest level since Dec. 2011
The Treasury will auction $70 billion in securities next week
The European Central Bank (ECB) cut rates

WEEK AHEAD
Next week, the Trade Balance and Productivity will be released on Thursday. Industrial Production, Empire State, and Import Prices will come out on Friday. In addition, there will be Treasury auctions on Tuesday, Wednesday, and Thursday. Mortgage markets will be closed on Monday in observance of Veterans Day.

Mortgage Time

November 1, 2013
MORTGAGE TIME
Mortgage Market News for the week of Nov. 1, 2013
Compliments of:
Patrick Gardner

Mortgage Loan Officer
NMLS ID: 378888

415-423-1424
Email me
Visit my website

MANUFACTURING ACTIVITY IMPROVES
It was a relatively quiet week for mortgage rates. A slightly more bullish economic outlook from the Fed and stronger than expected manufacturing data were the main influences this week. Good news for the economy is negative for mortgage rates, however, and rates ended the week a little higher.

As widely expected, there was no change in Fed policy at Wednesday’s Fed meeting, but Fed officials slightly upgraded their outlook for the economy from the prior statement. Fed officials again stated that they intend to wait for signs of sustained improvement in the labor market before they reduce their bond purchases. The consensus view is that the Fed will begin to scale back its bond purchases in April. The statement left the door open for an earlier start of the taper if the economic data is strong enough.

Early in the week, there were few surprises in the economic data and little movement in rates. That changed, though, when stronger than expected manufacturing data pushed mortgage rates higher on Thursday and Friday. The October ISM national manufacturing index rose to the highest level since April 2011, and the October Chicago PMI regional manufacturing index jumped to the highest level since March 2011. The consensus forecasts had been for lower readings due to the government shutdown at the beginning of the month. Investors will be watching to see if other sectors of the economy were similarly unaffected by the shutdown.

ALSO NOTABLE

Core CPI inflation was just 1.7% higher than one year ago
The Capacity Utilization Rate rose to the highest level since July 2008
Eurozone unemployment remained at a record high level of 12.2%
Oil prices dropped to the lowest level in four months


WEEK AHEAD

Two big reports will dominate the economic news next week. Third quarter Gross Domestic Product (GDP), the broadest measure of economic growth, will be released on Thursday. The Employment report will come out on Friday. As usual, this data on the number of jobs, the Unemployment Rate, and wage inflation will be the most highly anticipated economic data of the month, and it will carry even more weight than normal due to how it will influence Fed policy. Core PCE inflation, Personal Income, and Consumer Sentiment also will be released on Friday. ISM Services, Factory Orders, Leading Indicators, and the Trade Balance are scheduled earlier in the week. Mortgage markets will be closed on Monday in observance of Veterans Day.