Tuesday, April 22, 2014 - Article by: James Brooks - Polaris Home Funding Corp -
By James Brooks
The bond market is down 4/32 (2.72%), which should push this today's mortgage rates higher by approximately .125 of a discount point from yesterday's rates.
We did see bonds improve mid-day yesterday that caused some lenders to improve their rates intra-day by approximately .125 of a discount point. However, by the end of the session those gains had been erased. Therefore, if your lender improved pricing intra-day yesterday but did not reverse it during late afternoon trading, you may see more of an increase in this morning's rates.
March's Existing Homes Sales report was today's only relevant economic data. The National Association of Realtors announced late this morning that sales of previously owned homes fell 0.2% last month, nearly matching forecasts. The small decline dropped the number of sales to their lowest level since July 2012, indicating a stalling housing sector. Still, since the report didn't reveal too many surprises and is not considered to be a highly important piece of data, it has had a minimal impact on today's mortgage rates.
The Commerce Department will give us March's New Home Sales data at 10:00 AM ET tomorrow morning. This report tracks a much smaller portion of all home sales than today's Existing Home Sales report did. As with today's release, it gives us an indication of housing sector strength and future mortgage credit demand. But unless its results vary greatly from analysts' forecasts, I am not expecting the data to cause much movement in mortgage rates. Analysts are currently forecasting an increase in sales of newly constructed homes.
Tomorrow also has the first of this week's two Treasury auctions that have the potential to affect mortgage rates. 5-year Treasury Notes will be sold tomorrow with results being posted at 1:00 PM ET. A strong demand from investors could lead to afternoon strength in bonds and possibly an improvement in mortgage rates. However, a weak level of demand can negatively impact mortgage pricing tomorrow afternoon.
If I were considering financing/refinancing a home, I would.... Lock if my closing was taking place within 7 days... Lock if my closing was taking place between 8 and 20 days... Lock if my closing was taking place between 21 and 60 days... Lock if my closing was taking place over 60 days from now.
Didn't find the answer you wanted? Ask one of your own.