Houston Mortgage Weekly Update
Posted on Tue, Dec 29, 2009
This week's lending rates:
30 YR FIXED 5.25%
15 YR FIXED 4.75%
FHA/VA 5.5%
Rates are on the rise and have been for the last 6 business days! See chart below.
Home Sales Rise Again:
Sales of previously owned homes in Houston (which make up 86% of all home sales) jumped last month to their highest level in nearly three years. This is just the latest sign that points to an economic recovery.
The National Association of Realtors said that existing home sales increased 7.4% to an annual rate of 6.54 million units. This is the fastest pace since February 2007. The housing market, the main trigger of the most painful U.S. recession in 70 years, is stabilizing according to many analysts.
A separate report from the U.S. Federal Housing Finance Agency showed home prices rose 0.6 percent in October from September.
What Happened to Rates Last Week?
We all got a little coal in our stocking for Christmas as agency (Fannie Mae and Freddie Mac) mortgage backed securities lost 138 basis points last week. This is important because conventional 30 year fixed rates are based upon the sale of these agency's mortgage backed securities. This caused 30 year fixed interest rates to rise dramatically last week.
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 and government mortgage rates are based upon. So, I know if there is going to be a trend reversal in mortgage rates.
Contact the Home Coach Team Houston when you need help buying, selling, or financing a home.