FIRST TEAM’S WEEKLY MORTGAGE WATCH (June 3rd, 2018) THIS WEEK HIGHLIGHTS THE FOLLOWING UPDATES:
- Angst over the political situation in Italy threatened the stability of the Euro, and the announcement of more tariffs, upping the risk of a trade war, left markets wary.
- For most of last week, money flowed into the relative security of US Treasuries and bonds, pushing mortgage rates downward. However, Friday’s strong employment report reminded markets that the US economy continues to be on solid footing. Mortgage rates returned to Monday’s levels.
- During the week, GDP was adjusted downward, but only by a tenth, the ISM Manufacturing Index and Consumer Confidence posted respectable gains.
- Inflation data also seems to be showing fewer signs of easing. Overall, the week’s economic data solidified the near 100% probability that the Fed will raise rates in a few weeks.
- Economic data due this week is not as significant, but if the week starts with the ISM Services Index posting a gain rather than the expected loss, we are likely to see rates trending upward for the week. Of course, international pressures and political drama could change the course of rates at any time.
Headlines Say Housing Prices Up, But Not All
With the drumbeat of stories about rising housing prices, one might be tempted to think that housing prices are rising everywhere. However, as the saying goes, all real estate is local. According to NAR, 27 of the nation’s 350 largest metro areas are seeing price declines. Year-over-year prices have fallen 17.7% in Santa Maria, CA, while Pottsville PA saw an 8.1% drop. Napa, CA fell 6.7%. while Austin, TX and Beckley WA lost 4.3% and 4.2%, respectively.