What’s Ahead For Mortgage Rates This Week – May 23, 2016

You Ask, We Answer: 5 Ways That You Can Proactively Build and Improve Your Credit ScoreLast week’s economic news included the NAHB Housing Market Index, reports on housing starts, building reports and existing home sales. Minutes of the Federal Reserve’s last FOMC meeting were also released.

Homebuilder Confidence Unchanged, Housing Starts and Building Permits Increase

The National Association of Home Builders (NAHB) reported that builder confidence held steady with a reading of 58 in May. Analysts projected a reading of 58 and April’s reading was also 58. Builder confidence in market conditions could be slowing due to concerns over acquiring skilled labor and a shortage of developed lots. Demand for homes remains high, but a slim inventory of available properties and builder emphasis on higher-priced homes contributed to sidelining moderate income and first-time buyers.

Commerce Department reports for April Housing Starts and Building Permits issued suggest that tight housing inventories may receive some relief. April housing starts rose from a revised March reading of 1.099 million to 1.170 million starts. Housing starts increased by 6.60 percent in April. Housing starts have slowed as compared to the year-over-year period from April 2015 to 2016; housing starts increased by 10 percent for the same year-over-year period in 2015. While any increase in home construction is welcome, some analysts said that they did not expect a huge increase in home construction in coming months.

Construction of multifamily housing units rose by 10.70 percent, while single-family home construction increased by 3.30 percent. Rising rents and millennials delaying home purchases were seen as fueling multifamily home construction. As homes become less affordable, would-be buyers are continuing to rent, which places higher demand on rental units.

Pre-owned Home Sales Rise in April

Sales of previously owned homes rose by 1.70 percent in April to a seasonally-adjusted annual rate of 5.45 million sales. Sales increased by 12.10 percent in the Midwest, where homes are most affordable, and fell by 1.70 percent in the West, where homes are most costly. This development suggests that rapidly rising home prices have or will soon reach maximum levels in high-cost areas. Home prices in many areas rose rapidly in preceding months as short inventory and high demand created bidding wars and keen competition for available homes. A lack of affordable single family homes has caused some buyers to buy condos while others have put buying on hold.

Mortgage Rates Rise, New Jobless Claims Fall

Mortgage rates rose for 30-year fixed rate mortgages rose by one basis point to 3.58 percent; the average rate for a 15-year fixed rate mortgage was unchanged at 2.82 percent and the average rate for a 5/1 adjustable rate mortgage rose by two basis points to 2.80 percent. Discount points were 0.60, 0.50 and 0.50 percent respectively. Analysts are watching the Fed closely for any indication that it will raise the target federal funds rate in June, although concerns over the possibility of Great Britain leaving the European Union could cause the Fed to hold off on raising the rate. If the Fed raises the target federal funds rate, loan rates for credit cards and mortgages would also increase.

New jobless claims fell last week to 278,000 new claims against expectations of 279,000 new claims and the prior week’s reading of 294,000 new claims. Analysts said that a telecommunications strike caused the prior week’s raise in claims as striking workers who are replaced during a strike are eligible for jobless benefits.

What’s Ahead

This week’s scheduled economic releases include new and pending home sales along with weekly reports on mortgage rates and new jobless claims.

6152 S Hidden Hill Road Gold Canyon, AZ 85118

$450,000
4 Beds
2 Baths
1,859 SqFt
Status Active
MLS # 6677938
Property Type Single Family Residence
Price Type --
Escape to your desert sanctuary nestled among majestic saguaros! This captivating 4-bed, 2-bath home features a spacious great room perfect for relaxation and entertaining. Enjoy the convenience of epoxy flooring in the garage and a central vac system for easy maintenance. The modern kitchen boasts 2021 appliances, including a stove, microwave, and washer. Revel in tile and wood laminate flooring throughout, with plush carpeting in the bedrooms. A dedicated workcraft bench awaits in the garage for hobbyists. Unwind on the covered back patio with a cozy fireplace, ideal for gatherings. The master bath offers double sinks, and the large laundry room includes storage cabinets. Outside, desert landscaping creates a tranquil atmosphere with no HOA, giving you the freedom to enjoy your home fully.

24713 N 115th Avenue Sun City, AZ 85373

$450,000
3 Beds
3 Baths
1,600 SqFt
Status Active
MLS # 6677676
Property Type Manufactured Home
Price Type --
Welcome to your cozy retreat nestled on a picturesque acre of land! This charming home offers a perfect blend of comfort and tranquility. Upon entering, you're greeted by a spacious living area, ideal for entertaining guests or relaxing with loved ones. The open floor plan seamlessly connects the living room to the kitchen, creating an inviting atmosphere perfect for gatherings. The kitchen boasts ample cabinet space, and a convenient breakfast bar. The home features three bedrooms, providing plenty of space for the whole family or guests. Outside, you'll find a sprawling yard with endless possibilities. Whether you envision a garden oasis, a playground for children, or simply a space to relax and enjoy nature, this acre of land provides the perfect canvas.

6437 N 75th Drive Glendale, AZ 85303

$450,000
3 Beds
2.5 Baths
1,902 SqFt
Status Active
MLS # 6676166
Property Type Single Family Residence
Price Type --
Your dream home is here! This charming 2-story home boasts plenty of parking space and welcomes you with an inviting interior, complete with tall vaulted ceilings and a cozy fireplace. Family room offers an ideal space for gatherings. The kitchen is a culinary delight, featuring ample cabinetry, granite counters, SS appliances, and a center island with a breakfast bar. Relax in the main bedroom, which includes a full bathroom and a walk-in closet. Additionally, the Arizona room provides versatile space for an office or media center. The backyard is an entertainer's dream, with paver patios, low-maintenance synthetic grass, a useful shed, and ample space for a variety of outdoor activities. This property, with its blend of comfort and convenience, is the perfect choice for your next home!

9140 W Meadow Drive Peoria, AZ 85382

$450,000
4 Beds
2.5 Baths
2,151 SqFt
Status Active
MLS # 6678246
Property Type Single Family Residence
Price Type --
This 2,151 sq ft, meticulously designed residence features 4 spacious bedrooms and 2.5 baths. Located directly across from a huge green-belt/park. This two-story floor plan invites you into a welcoming great room. The charming kitchen, complete with appliances, is perfect for entertaining. Neutral tones. Tile flooring in the great room, kitchen, bathrooms and laundry. The flexible downstairs den serves as a home office or bonus room. Upstairs has a loft with balcony. The split bedroom floor plan ensures privacy. The upstairs primary suite features a full bath and walk-in closet. Additional highlights include blinds, ceiling fans, and upstairs laundry. Step outside to your private balcony and patio with views. blinds, ceiling fans, and upstairs laundry. 2 car garage.