Mortgage rates for February 26th, 2019 will start the day at improved levels as Mortgage Backed Securities and Treasuries start the day in positive territory. The early morning release of the Housing Starts report appears to be having a positive affect on the market.
Mortgage Backed Securities and Treasury Snapshot:
Mortgage Backed Security Coupon FNMA 4.0 opened the day at the 102.04 level and the 10y Treasury opened at the 2.65% level. Clearly not a significant improvement from yesterday’s open however they are improved from yesterday afternoon.
FHA Mortgage Rates
Today we have Building Permits, CaseShiller, Housing Starts and Consumer Confidence. Also today is Fed Chairman Powell’s testimony to Congress (if anything important comes from it we’ll update today’s post). Wednesday brings the weekly Mortgage Market Index data, Durable Goods (for January). Thursday is the GDP Prelim Q4 report and Chicago PMI report. We finish off the week with Core PCE, Personal Incomes, Retail Sales (January), and ISM Manufacturing PMI (February).
The most glaring number in today’s report is the steep decline in housing starts. Housing starts declined 11.2% in December vs a 0.4% increase in November. Needless to say that is a significant reversal and one to keep an eye on when January’s report comes out. Housing permits also declined; coming in with a small increase of 0.3% after a 4.5% increase in November. Single Family starts declined 6.7% and multi-family starts declined 20.4%. Overall this mornings report was a negative for the economy but a potential positive for mortgage rates.
Why This Matters To Mortgage Rates
This matters to mortgage rates because housing is a big part of the U.S. economy and the data this morning was not very good. That being said; many analyst are going to point out that during this time we had a significant government shutdown and trade tensions with China were high. It’s difficult to day if those two things had a significant effect on housing. The biggest issue with housing is inventory and incomes. Not enough homes are available and incomes have not increased the way home values have increased. First time home buyers face a lot of hurdles when buying their first home. Until these issues are resolved we might see a prolonged period of weak housing numbers.
Yesterday’s Wholesale Inventories and Sales:
Wholesale Inventories came in stronger than expected while Wholesale Sales came in weaker than expected. Expectations were for Wholesale Inventories to print at 0.3 however the final reading came in at 1.1. Wholesale Sales was expected to come in at -0.2 however the final reading came in at -1.0. These reports had little to no effect on the direction of mortgage rates on Monday. The bigger news story was the trade negotiations with China.
Update on Consumer Confidence Report:
Don’t tell consumers the economy is slowing! This mornings Consumer Confidence came in much higher than expected. Expectations were for a 124.7 reading however the final print came in at 131.4. That is a strong reading from an important report. However the market has had little reaction to the report due to Fed Chairman Powell speaking to Congress.
Currently We Are Seeing:
30 year fixed mortgage rates below 4.375%, 20 year fixed mortgage rates below 4.25% and 15 year fixed rates below 3.75%. 30 year fixed FHA mortgage rates are below 4.125%.
Please keep in mind that mortgage rates adjust daily; sometimes they adjust multiple times in a day when the bond market is volatile. Also things like obtaining cash out, lower credit scores, higher Loan-To-Value ratios, rental properties and the subordination of a second mortgage will cause in an increase in your mortgage rate. To obtain the most up-to-date quote specific to your loan scenario be sure to contact Loan Officer Kevin O’Connor at 1-800-550-5538 or you can submit a “Contact Us” request on the our website.
JB Mortgage Capital, Inc.:
We offer industry low mortgage rates for both refinance and purchase transactions, personal one-on-one service and we have an A+ rating with the Better Business Bureau (BBB). We also have a top rating with the Business Consumers Alliance (AAA). We utilize the latest technology to ensure a fast closing and Loan Officer Kevin O’Connor has over 14 years of experience as a mortgage professional. You can contact him directly at 1-800-550-5538.