Mountain Village mortgage sends out weekly updates on the Cashiers Highlands mortgage market. These are Jim Mullen's latest findings and his opinion on what is happening and what we can expect here in the western North Carolina Mountains.
This has been another wild week. The 30 year conforming fixed rate is now 6.250% and the 15 year rate is 5.875%. This is up from last week but still at a historically low rates. The experts feel the markets will level out soon.
The current market conditions make it more important than ever for your purchasers to discuss their mortgage needs with a trusted mortgage counselor as early as possible. I can be reached at night and on weekends on my cell 828 200-9168.
Mortgage Time Mortgage Market News for the week ending October 10, 2008
Compliments of Jim Mullen Mountain Village Mortgage Loan Consultant
PHONE:(828) 743-7073
FAX:(828) 743-9830
https://mail.kendallhunt.com/exchweb/bin/redir.asp?URL=http://www.ncmountainvillagemortgage.com
jmullen@metrocitiesmtg.com
3065 Highway 64 East Sapphire, NC 28774
Cell: (828) 200-9168
Events This Week:
Fed Funds rate cut
Pending Sales rose
Trade Deficit lower
Import Prices fell
Events Next Week:
Wed 10/15 PPI Retail Sales
Thur 10/16 CPI Industrial Prod.
Fri 10/17 Housing Starts Sentiment
Stocks Fall Further
This week the stock market fell to the lowest level since 2003. Normally mortgage markets improve during a stock market decline, since Fannie Mae, Freddie Mac, and Ginnie Mae mortgage backed securities (the vehicles through which most mortgages made today are sold) are considered a relatively safe haven. This week, however, the prices paid for these securities moved lower as well. One reason is that some investment funds have been forced to reduce their leverage and sell nearly every asset class in their portfolios. Another factor is investor concern that the supply of debt will increase significantly as the government funds its rescue actions. Mortgage rates ended the week moderately higher.
Investors viewed the $700 billion rescue plan passed last week as a necessary first step, but not an immediate solution to the credit crisis. Governments around the world took a variety of additional steps during the week to support the banking system. A historic coordinated interest rate cut from many central banks took place on Wednesday. The Federal Reserve lowered the Fed Funds rate by one half point to 1.50%, citing reduced inflationary pressures due to an economic slowdown and falling energy prices. The Fed Funds rate heavily influences short-term interest rates, but its impact on long-term mortgage rates varies based on inflation expectations. In this case, the Fed rate cut most likely helped move mortgage rates a little lower, but the factors described above had more influence.
The decline in home prices was a major cause of the credit crisis, and stabilization in the housing market will be important to resolve the problems. Little noticed this week, August Pending Home Sales jumped 7% from July, far above the consensus for a small decline. They were 9% higher than one year ago and were at the highest level since June 2007. Pending Home Sales are a leading indicator for the housing market, meaning that the next Existing and New Home Sales reports may show increases. Investors will be closely watching future housing market data to see if the trend continues.
Also Notable:
Fed Chief Bernanke predicted that inflation will moderate "pretty significantly"
In August, consumer borrowing declined for the first time in more than a decade
The Dow was down about 40% from the record high levels seen in October 2007
Oil prices fell to $80 per barrel, down from $147 per barrel in July
Average 30 yr fixed rate:
Last week:
+0.03%
This week:
+0.20%
Stocks (weekly):
Dow:
8,216
-2,470
NASDAQ:
1,581
-438
Week Ahead
The Economic Calendar will be full next week. The Consumer Price Index (CPI) inflation report will come out on Thursday. CPI looks at the price change for those finished goods which are sold to consumers. The Producer Price Index (PPI) will be released on Wednesday. PPI focuses on the increase in prices of "intermediate" goods used by companies to produce finished products. Retail Sales is also scheduled for Wednesday. Industrial Production, an important indicator of economic activity, will be released on Thursday. Housing Starts will come out on Friday. Consumer Sentiment, the Philadelphia Fed index, and the Fed's Beige Book will round out a busy week. Investors will also be watching for additional government actions to ease credit markets. Mortgage markets will be closed on Monday in observance of Columbus Day.
To learn more about news impacting interest rates and mortgage markets, go to https://mail.kendallhunt.com/exchweb/bin/redir.asp?URL=http://www.mbsquoteline.comTo learn more about the newsletter, please call 800-627-1077All material Copyright © Ress No. 1, LTD and may not be reproduced without permission.
The current market conditions make it more important than ever for your purchasers to discuss their mortgage needs with a trusted mortgage counselor as early as possible. I can be reached at night and on weekends on my cell 828 200-9168.
Mortgage Time Mortgage Market News for the week ending October 10, 2008
Compliments of Jim Mullen Mountain Village Mortgage Loan Consultant
PHONE:(828) 743-7073
FAX:(828) 743-9830
https://mail.kendallhunt.com/exchweb/bin/redir.asp?URL=http://www.ncmountainvillagemortgage.com
jmullen@metrocitiesmtg.com
3065 Highway 64 East Sapphire, NC 28774
Cell: (828) 200-9168
Events This Week:
Fed Funds rate cut
Pending Sales rose
Trade Deficit lower
Import Prices fell
Events Next Week:
Wed 10/15 PPI Retail Sales
Thur 10/16 CPI Industrial Prod.
Fri 10/17 Housing Starts Sentiment
Stocks Fall Further
This week the stock market fell to the lowest level since 2003. Normally mortgage markets improve during a stock market decline, since Fannie Mae, Freddie Mac, and Ginnie Mae mortgage backed securities (the vehicles through which most mortgages made today are sold) are considered a relatively safe haven. This week, however, the prices paid for these securities moved lower as well. One reason is that some investment funds have been forced to reduce their leverage and sell nearly every asset class in their portfolios. Another factor is investor concern that the supply of debt will increase significantly as the government funds its rescue actions. Mortgage rates ended the week moderately higher.
Investors viewed the $700 billion rescue plan passed last week as a necessary first step, but not an immediate solution to the credit crisis. Governments around the world took a variety of additional steps during the week to support the banking system. A historic coordinated interest rate cut from many central banks took place on Wednesday. The Federal Reserve lowered the Fed Funds rate by one half point to 1.50%, citing reduced inflationary pressures due to an economic slowdown and falling energy prices. The Fed Funds rate heavily influences short-term interest rates, but its impact on long-term mortgage rates varies based on inflation expectations. In this case, the Fed rate cut most likely helped move mortgage rates a little lower, but the factors described above had more influence.
The decline in home prices was a major cause of the credit crisis, and stabilization in the housing market will be important to resolve the problems. Little noticed this week, August Pending Home Sales jumped 7% from July, far above the consensus for a small decline. They were 9% higher than one year ago and were at the highest level since June 2007. Pending Home Sales are a leading indicator for the housing market, meaning that the next Existing and New Home Sales reports may show increases. Investors will be closely watching future housing market data to see if the trend continues.
Also Notable:
Fed Chief Bernanke predicted that inflation will moderate "pretty significantly"
In August, consumer borrowing declined for the first time in more than a decade
The Dow was down about 40% from the record high levels seen in October 2007
Oil prices fell to $80 per barrel, down from $147 per barrel in July
Average 30 yr fixed rate:
Last week:
+0.03%
This week:
+0.20%
Stocks (weekly):
Dow:
8,216
-2,470
NASDAQ:
1,581
-438
Week Ahead
The Economic Calendar will be full next week. The Consumer Price Index (CPI) inflation report will come out on Thursday. CPI looks at the price change for those finished goods which are sold to consumers. The Producer Price Index (PPI) will be released on Wednesday. PPI focuses on the increase in prices of "intermediate" goods used by companies to produce finished products. Retail Sales is also scheduled for Wednesday. Industrial Production, an important indicator of economic activity, will be released on Thursday. Housing Starts will come out on Friday. Consumer Sentiment, the Philadelphia Fed index, and the Fed's Beige Book will round out a busy week. Investors will also be watching for additional government actions to ease credit markets. Mortgage markets will be closed on Monday in observance of Columbus Day.
To learn more about news impacting interest rates and mortgage markets, go to https://mail.kendallhunt.com/exchweb/bin/redir.asp?URL=http://www.mbsquoteline.comTo learn more about the newsletter, please call 800-627-1077All material Copyright © Ress No. 1, LTD and may not be reproduced without permission.
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