My New Blog

Tax Credit Ends Soon:
The wildly popular first time home buyer’s tax credit is set to expire in November. This is a tax credit of $8,000 for anyone that has not owned a home in the last 36 months. It takes an average of approximately 30 days to close on a mortgage once you find your dream home. So that basically means that you have until October to put in a contract on a home to take advantage of this great tax credit.

Both existing and new home sales have climbed for the past 4 months and inventories are decreasing. With 30 year fixed mortgage rates consistently in the mid 5% range for an average conventional mortgage, it seems that all the stars are aligned for a final push in demand for homes. Don’t assume that you will be able to go back and forth between several homes with low-ball offers. The market has changed and you have very little time to make sure that you the best of everything: Low rates, $8,000 tax credit, and great selection at fair prices.

What happened to rates last week?

Mortgage backed securities gained +122 basis points last week which helped to push 30 year fixed mortgage rates to their lowest levels in the last two weeks. The primary reason for the gain was due to some economic reports that showed some additional weakness. We had dismal retail sales and consumer confidence and we also were the beneficiary of some profit taking and a selloff in the stock markets.

What to watch out for this week:
The following are the major economic reports that will hit the market this week. They each have the ability to affect mortgage rates. I will watch these reports closely for you and let you know if there are any big surprises.

I know you are busy and it is virtually impossible for you to keep track of what is going on in the economy. I monitor the trading of Mortgage Backed Securities; the only thing conventional mortgage rates are based upon. So I know if there is going to be a trend reversal in mortgage rates.

More Positive News for Housing:
Many news outlets and economists are finally calling it an official “housing bottom”. This is the result of the progress in the housing market over the past three months. We added to that pool of positive housing news last week.

The Case-Shiller Home Price Index showed that home prices were either flat or increased in 16 out of the 20 major markets that they monitor. In a separate report, New Home Sales were up 11% which was the largest gain in over eight years. While higher priced homes will continue to struggle for some time, mid to lower priced homes are really heating up.

What happened to rates last week?

We had a huge gain in mortgage backed securities last week which helped to push mortgage rates to their lowest levels in months. The weak Initial Claims and GDP data along with a very successful 7 year Treasury auction combined to temporarily lower rates. We need to take advantage of these great rates before this rate rollercoaster changes again.

What to watch out for this week:
The following are the major economic reports that will hit the market this week. They each have the ability to affect mortgage rates. I will watch these reports closely for you and let you know if there are any big surprises.



I know you are busy and it is virtually impossible for you to keep track of what is going on in the economy. I monitor the trading of Mortgage Backed Securities; the only thing conventional mortgage rates are based upon. So I know if there is going to be a trend reversal in mortgage rates.

Call on me anytime for an industry update.

Respectfully,

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