What’s Ahead For Mortgage Rates This Week – June 29th, 2020

Summary: Mortgage rates remained flat last week, boosting homebuyer demand and leading to a rebound in homebuying activity. This article will go over where mortgage rates are today and what is impacting them.

Last week’s scheduled economic news included readings on sales of new and pre-owned homes and reports on inflation. Weekly reports on mortgage rates and new and continuing jobless claims were also released.

Home Sales Results Mixed for May

The National Association of Realtors® reported fewer sales of pre-owned homes in May at a seasonally-adjusted annual pace of 3.91 million sales. Analysts expected 3.80 million sales as compared to April’s reading of 4.33 million sales. This was the lowest reading for sales of pre-owned homes since July 2010 and sales were 26.60 percent lower year-over-year.

Lawrence Yun,  the chief economist for the National Association of Realtors®, said that sales were expected to rise as coronavirus-related restrictis were lifted and people returned to work. Mr. Yun said in a report that sales of previously-owned homes should surpass last year’s annual sales pace in the second half of 2020. Mr. Yun made this forecast before rising coronavirus cases occurring after the reopening of the economy started.

There was a 4.80 months supply of previously-owned homes for sale in May, which was below the six-months supply indicating a balanced market.

The Commerce Department reported 676,000 new homes sold in May on a seasonally-adjusted annual basis; this surpassed expectations of 650,000 sales and April’s revised annual sales pace of 580,000 new homes sold. New home sales rose by 45.50 percent in May in the Northeastern region; New home sales rose by 29 percent in the West and 15.20 percent in the South, New home sales fell by -6.40 percent in the Midwest.

The average sale price of new homes was $317,900 in May. There was a 5.60 months supply of new homes available in May, which nearly matched the six months average inventory.

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Mortgage Rates Hold Steady as Jobless Claims Fall

Freddie Mac reported little change in average mortgage rates last week. Rates for 30-year fixed-rate mortgages were unchanged at an average rate of 3.13 percent; The average rate for 15-year fixed-rate mortgages rose by one basis point to 2.59 percent and the average rate for 5/1 adjustable rate mortgages fell one basis point to 3.08 percent. Discount points averaged 0.80 percent for fixed-rate mortgages and 0.50 percent for 5/1 adjustable rate mortgages.

Initial jobless claims fell to 1.48 million from the prior week’s reading of 1.51 million new claims. Continuing jobless claims were also lower last week with 19.50 million claims filed as compared to 20.30 million claims filed the previous week.

Rising Inflation Indicates Improving Economy

Inflation rose to a seasonally-adjusted annual pace of 8.20 percent in May as compared to April’s reading of -12.60 percent Analysts expected the inflation rate to reach 9.90 percent.

Current Numbers for WA, OR, ID, and CO

Washington State mortgage rates hit 3.52% and 3.30% for conforming 30-year mortgages and 5/1 ARMs, and for jumbo loans, the numbers in the state are 3.32% and 2.71% for 30-year mortgages and 5/1 ARMs, respectively. In Oregon, conforming loan rates are 3.40% for 30-year mortgages and 3.32% for 5/1 ARMs. For jumbo loans, the numbers are 3.33% for 30-year mortgages and 2.71% for 5/1 ARMs.

Mortgage rates in Idaho for conforming loans for 30-year fixed-rate mortgages is 3.29%, and 3.35% for 5/1 ARMs, while for jumbo loans, the numbers for each loan type are 3.33% and 2.63%, respectively. In Colorado, the rate for conforming loans for 30-year fixed-rate mortgages is 3.51% and 3.26% for 5/1 ARMs. For jumbo loans, the numbers for each loan type are 3.18% and 3.44%.

What’s Ahead

This week’s scheduled economic news releases include readings on pending home sales, Case-Shiller Home Price Indices, and labor-sector jobs reports. The national unemployment rate will be released along with weekly readings on mortgage rates and new and continuing jobless claims.

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Ready to Apply For a Mortgage in WA, OR, CO, or ID?

Do you have questions about home loans? Are you ready to apply for a mortgage to buy a home? If so, Sammamish Mortgage can help. We are a local mortgage company from Bellevue, Washington serving the entire state, as well as Oregon, Idaho, and Colorado. We offer many mortgage programs to buyers all over the Pacific Northwest. Contact us today with any questions you have about mortgages.