What’s Ahead For Mortgage Rates This Week – May 31, 2016

Last week’s economic reports included new home sales, pending home sales along with weekly mortgage rates and new jobless claims.

New Home Sales Surpass Expectations

Sales of new homes surpassed expectations and the prior month’s reading. April’s reading of 619,000 sales exceeded expectations of 523,000 new homes sold and 531,000 new homes sold in March.  New home sales rose by 16.60 percent on a seasonally adjusted annual basis, which was the highest increase in 24 years. 

Analysts said that April’s new home sales indicate that builders are increasing production of new homes to meet high demand for homes. Short inventories of available homes are credited with driving up demand and home prices. Buyers seeking family homes are contending with investor buyers and cash buyers in popular markets.

With affordability becoming limited in many cities, first time and moderate income homebuyers aren’t buying as many homes as they once did. This development contributes to slowing markets, as move-up buyers generally rely on first time buyers to purchase their homes. 

Shortages of available homes has pressured home builders to break ground on new home construction projects, but builders continue to cite labor shortages and a lack of buildable lots as reasons why they aren’t building homes as fast as homes are needed. 

Pending Home Sales Numbers Suggest Peak Buying Season Returns

Pending home sales were also higher than forecast in April with a reading of 5.10 percent as compared to expectations of 0.80 percent for April and the March reading of 1.60 percent. Pending home sales gauge future closings for home sales and reached their highest level in 10 years and posted a year-over-year gain of 4.60 percent. 

Three of four regional readings for pending home sales posted gains, with home sales in the Midwest posting slower growth. On a year-over-year basis, he South posted a gain of 6.80 percent and the Northeast posted a gain of 1.20 percent. The West saw a jump in pending sales with a reading of 11.40 percent after posting a negative reading in March. 

April’s expansion in new and pending sales suggests that the peak home buying season is back.

Mortgage Rates Rise; New Jobless Claims Fall

Freddie Mac reported higher average mortgage rates. The rate for a 30-year fixed rate mortgage was six basis points higher at 3.64 percent; the rate for a 15-year mortgage rose eight basis points to 2.89 percent. The average rate for a 5/1 adjustable rate mortgage rose seven points to 2.87 percent. Discount points averaged 0.50 percent for all mortgage types. 

New jobless claims dipped last week to 268,000 as compared to an expected reading of 275,000 new claims and the prior week’s reading of 278,000 new claims. Analysts said that New York school employees that were eligible for benefits boosted jobless claims earlier in May due to a non-typical law that allows some school workers to draw unemployment during school closures such as spring break or labor disputes.

What‘s Ahead This Week

This week’s scheduled economic news includes Case-Shiller Home Price Indices, construction spending and reports on inflation, core inflation and consumer sentiment. No reports were scheduled for Monday due to the Memorial Day holiday. 

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9451 E Becker Lane Scottsdale, AZ 85260

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$460,000

3 Beds

2 Baths

1,259 SqFt

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MLS # 6692644

Property Type Apartment

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RARE FIND. Ground floor condo with garage and 1 covered parking space. Home features granite countertops, stainless steel appliances, full-size washer & dryer, 20'' tile and wood look laminate flooring, walk-in master shower, raised vessel sinks, glass shower doors, window coverings. New HVAC in 2018, water heater 2019, Windows replaced in 12/22, resurfaced patio in 3/24, Retractable door screens front and back in 2024, Dry bar and cabinets added in 2/23. HOA includes tennis courts, swimming pools, hot tubs, clubhouse with fitness room. Walk to shopping, restaurants, and grocery stores. Entertainment venues and golf courses close by. Short drive to Mayo Clinic and MLB Spring Training, near Scottsdale Greenbelt Trail. Near church and schools.

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17719 N 113th Avenue Surprise, AZ 85378

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$460,000

3 Beds

2 Baths

1,934 SqFt

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MLS # 6663313

Property Type Single Family Residence

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Welcome to the Gated Community of Canyon Ridge West! This stunning home offers privacy with no neighbors behind and boasts a sparkling pool with a soothing waterfall feature, along with a convenient RV gate and added parking for all your outdoor storage needs. Inside, vaulted ceilings with tubular skylights and neutral tile floors create a spacious ambiance. The flexible layout includes a private den and ample living space. New HVAC in 2024! *Edited Neutral paint photos added.

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10718 E Secret Canyon Road Gold Canyon, AZ 85118

$459,999

3 Beds

2 Baths

1,646 SqFt

Status Active

MLS # 6685607

Property Type Single Family Residence

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Nestled near the Superstition Mountains this property offers a variety of special features and accommodations like: flexible floor plan, plantation shutters, mountain view, quiet gated community, ***sparkling pool (w/mesh child safety pool fence included)***, automatic sun shade, office den, newly remodeled kitchen and floors throughout the house, ***quality slab granite countertop***, farmhouse kitchen sink and faucet, ***new bathroom vanity countertop & faucet***, 2 car garage, ***new roof***, fireplace AND its a corner lot so no neighbors to the right of this property. Single story homes surround this lot so those looking for privacy this is where it's at! It's also near hiking trails so for those looking to do some desert exploring its perfect! Don't wait too long!

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20599 W Nelson Place Buckeye, AZ 85396

$459,999

3 Beds

2 Baths

1,623 SqFt

Status Active

MLS # 6677655

Property Type Single Family Residence

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You don't want to miss out on this move-in ready beauty. Located in the stunning and sought after subdivision of Verrado in Buckeye. The home is in immaculate condition from ceiling to floor. Wood-like tile flooring though all the main living & walking areas. Your new kitchen offers granite countertops, breakfast bar, contemporary light fixtures, upgraded cabinetry with lots of storage space, and stainless steel appliances. The backyard has no maintenance landscaping, covered patio, and plenty of room to relax and entertain. Don't miss out on this one! It won't last long on the market. Thanks for stopping in.

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