Mortgage News

 

Mortgage applications for the week ending April 13th rose by 4.9%, as purchase apps rose 6.1%, and refi apps rose 3.5%. Purchase applications, on a month-over-month basis, have rebounded in recent reports to near the early 2018 highs. This is a positive for the housing market, especially given the recent increase in mortgage rates. Of course, the new and existing home sales data will have to confirm the uptick in activity in upcoming reports.

Housing Starts for March rose by 1.9%, now bringing the year over year rate up to +10.9%. Multi-family activity was the driver in the monthly gains, while single-family starts were down 3.7%. Looking at the monthly results by region, starts fell in the West -1.5%, and -.6% in the South, with increases in the Northeast of +.8% and a whopping +22.4% gain in the Midwest. Building permits were also released, showing a 2.5% increase for March on a 19% increase in multi-family and a 5.5% decline in single-family. Overall, the single-family sector is still running at a positive when looking at year-over-year numbers, but the next few months will be important, given the recent rise in interest rates.


On Thursday, Initial Jobless Claims came in 1k lower than the previous week to 232k, bringing the four-week moving average to 231k. The continued decline since January should quiet any chatter of weakening health of the labor market due to a lull in March hiring. With seasonal hiring expected to accelerate, the unemployment rate is expected to move below 4% this quarter.

Looking at the markets over the past week, we’ve seen equities stabilize and perform a little better, while the sharper sell-off in Treasuries has taken interest rates back up higher toward stronger support levels from ~2.92-2.95% and now the highest levels we’ve seen since back in February. Most see this move primarily driven by inflation signals in the rising prices of steel and oil, specifically as oil prices have hit a three-year high. While we view the market as a bit oversold in the short-term and due for a bounce back to better levels and lower rates, we are reminded that this so-called bounce could take a little while and we could sideways grind these upper levels in the coming week(s). That said, not a good time to play the market and any better pricing you see should be taken advantage of. Looking ahead to next week, the economic calendar is loaded with numerous reports with the top tiers being those of Durable Goods and GDP on Thursday and Friday.

 

 

 

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