What’s Ahead For Mortgage Rates This Week – July 6th, 2020
Summary: Mortgage rates declined to another all-time low heading into the July 4th weekend, with speculation that the rate may actually dip under the 3% mark at some point before the end of the year. This article will go over where mortgage rates are today and what is impacting them.
Last week’s scheduled economic reports included readings on pending home sales, Case-Shiller Home Price Indices, and labor sector reports on private and public-sector job growth. Data on construction spending was also released. Weekly readings on mortgage rates and jobless claims were also released.
Pending Home Sales Jump in May
Sales of homes for which purchase contracts were signed rose by 44.30 percent in May and was the highest month-to-month increase recorded since the report’s inception in 2001..Pending home sales are sales with signed purchase contracts but aren’t closed.
Lawrence Yun, chief economist for the National Association of Realtors® said, “This has been a spectacular bounce-back and also speaks to how the housing sector could lead the way for a broader economic recovery.” This positive news could be dampened by rising infection rates for the Covid-19 outbreak as some states reversed decisions to re-open additional parts of their economies.
Case-Shiller: Home Price Growth Rises in April
The Case-Shiller National Home Price Index reported that home prices grew by 0.10 percent to 4.70 percent on a seasonally-adjusted annual basis. This reading lagged behind the worst part of the Covid-19 outbreak and analysts cautioned that home price growth would fall in the future. The Case-Shiller 20-City Index reported the top three cities for home price growth were Phoenix, Arizona, Seattle, Washington, and Minneapolis Minnesota. The geographical disparity between these cities differs from recent years when coastal cities dominated home price growth rates.
In related news, the Commerce Department reported improvement in construction spending in May. Construction spending fell -2.20 percent in May as compared to -3.50 percent in April.
View Current Mortgage Rates Jul, 12, Sun, 2020
Mortgage Rates Hit All-Time Low; Jobless Claims Ease
Freddie Mac reported the lowest mortgage rates reported since the inception of their Primary Mortgage Market Survey. Rates for 30-year fixed-rate mortgages averaged 3.07 percent and were eight basis points lower. Rates for 15-year mortgages dropped by three basis points on average to 2.56 percent. Rates for 5/1 adjustable-rate mortgages dropped by eight basis points on average to 3.00 percent.
Discount points averaged 0.80 percent for fixed-rate mortgages and 0.30 percent for 5/1 adjustable rate mortgages.
New jobless claims fell to 1.43 million claims filed from the prior week’s reading of 1.48 million initial claims filed. Ongoing jobless claims rose from 19.20 million claims to 19.30 million continuing jobless claims.filed. New and continuing jobless claims were far above pre-coronavirus levels.
Job Growth Reports Mixed as Unemployment Rate Falls
ADP reported 2.37 million private-sector jobs added in June as compared to May’s reading of 3.07 million private sector jobs added. The federal government’s Non-Farm Payrolls report showed 4.80 million public and private sector jobs added in June as compared to 2.70 million public and private sector jobs added in May.
Current Numbers for WA, OR, ID, and CO
Washington State mortgage rates hit 3.41% and 2.96% 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 3.49% for 30-year mortgages and 2.83% 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 3.26%, and 2.71% 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 3.27% and 2.86% for 5/1 ARMs. For jumbo loans, the numbers for each loan type are 3.35% and 2.63%.
What’s Ahead
This week’s scheduled economic reports include readings on job openings and weekly reports on mortgage rates and jobless claims.
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