Blog - Envision Funding

What’s Ahead For Mortgage Rates This Week – February 25th, 2019

February 25, 2019 by Regine Lane

What’s Ahead For Mortgage Rates This Week – February 25th, 2019 Last week’s economic news included readings on homebuilder confidence in housing market conditions, minutes of January’s Federal Open Market Committee meeting, and existing home sales reported by the National Association of Realtors®. Weekly readings on mortgage rates and new jobless claims were also released.

NAHB: Home Builder Confidence Rises to 4-Month High

Homebuilder confidence rose for the second consecutive month in February and four points higher to an index reading of 62, which exceeded analyst expectations of a one-point increase in builder confidence.

Components of the NAHB Housing Market Index also rose. Builder confidence in current market conditions rose three points to 67; builder confidence in market conditions over the next six months rose five points to 68 and builder confidence rose four points to an index reading of 48. Index readings over 50 are considered positive, but readings for buyer traffic are typically lower than the benchmark of 50.

Real estate and mortgage lending pros consider the Housing Market Index and its component readings as an indication of future home building pace. During times with few available homes and high buyer demand, industry leaders rely on builders to provide more homes.

Fed Holds Off on Raising Key Interest Rate

Minutes of the Fed’s January meeting of its Federal Open Market Committee indicated a divide in members’ positions regarding raising or holding the current federal funds rate steady. The current rate of 2.25 to 2.50 percent was unchanged as Committee members considered global economic uncertainty and domestic concerns including trade policies. On a positive note, the Fed lowered its expected reading for long-term national unemployment from 4.50 percent to 4.40 percent. Strong labor markets encourage would-be home buyers to consider buying homes.

Sales of Pre-owned Homes Fall to Three-Year Low

The National Association of Realtors® reported the lowest level of previously-owned home sales in three years. Sales were 1.20 percent lower than their three-year low in December and were 8.50 percent lower year-over-year. 4,94 million pre-owned homes were sold on a seasonally-adjusted annual basis; analysts expected 4,99 million sales and 5.00 million pre-owned homes were sold in December.

The national median home price was $247,500 in January, which was 2.80 percent higher year-over-year; this was the slowest rate of home price growth since 2012.

Home prices may have peaked in high-demand metro areas where prices are unaffordable for most residents. First-time home buyers lost market share in January and comprised 29 percent of all sales as compared to a long-term market share of 40 percent. Concerns over affordability, supplies of homes for sale and potential increases in mortgage rates sidelined first-time and moderate-income home buyers.

Mortgage Rates, New Jobless Claims Lower

Freddie Mac reported lower mortgage rates last week; rates for a 30-year fixed rate mortgage fell two basis points to 4.35 percent. Rates for a 15-year fixed-rate mortgage averaged three basis points lower at 3.78 percent.

Rates for a 5/1 adjustable-rate mortgage averaged four basis points lower at 3.84 percent. Discount points averaged 0.50 percent for 30-year fixed rate mortgages, 0.40 percent for 15-year fixed rate mortgages, and 0.30 percent for 5/1 adjustable rate mortgages.

First-time jobless claims were lower last week with 216,000 claims filed as compared to expectations of 229,000 new claims filed and the previous week’s reading of 239,000 first-time claims filed.

What‘s Ahead

This week’s scheduled economic reports include Case-Shiller Home Price Indices, new home sales, and Commerce Department readings on housing starts and building permits issued. Data on consumer confidence is expected along with weekly readings on mortgage rates and new jobless claims.

FOMC Meeting Minutes: Why Fed’s Rate Policy Reversed Course

February 22, 2019 by Regine Lane

FOMC Meeting Minutes: Why Fed’s Rate Policy Reversed Course After raising the target range for the federal funds rate in 2018, the Fed’s Federal Open Market Committee did not raise the Central Bank’s key interest rate at its meeting of January 29 and 30. While Committee members did not raise the Fed’s key rate, members were divided on the interest rate decision.

FOMC Members Divided On Interest Rate Decision

Minutes of January’s FOMC meeting indicated that member viewpoints varied about how the Fed should deal with the Fed’s target interest rate range. One group said that interest rate increases may be necessary if inflation increases above the Federal Reserve’s baseline forecast.

Other FOMC members supported raising the Fed’s interest rate range later in 2019 if economic conditions move as expected. Overall, FOMC members said that there were “few risks” in the Committee’s current position of patience, but they were open to reassessing that position according to how economic conditions change.

FOMC Cites Reasons For Halting Rate Increases

Committee members provided several reasons for reversing their 2018 policy of consistent rate hikes including declining economic conditions since early 2018. Global and domestic economic conditions slowed; deteriorating conditions were supported by lower readings on consumer and business sentiment. Federal government policies including the partial government shutdown and then-current trade policy contributed to the deteriorating economic outlook in late 2018.

Ongoing influences driving FOMC monetary policy decisions include the Fed’s mandate for achieving maximum employment, stable prices and moderate long-term interest rates. Because short-term data change frequently, Fed monetary policy reflects long-term goals, medium-term outlook and the Committee’s risk assessments in multiple financial and economic sectors. The Committee said that long-term inflation of two percent indicates stable pricing as required by federal mandate; any prolonged deviation above or below the two percent reading would concern Committee members.

FOMC indicated progress with its maximum employment mandate by changing its long-run unemployment outlook from 4.60 percent to 4.40 percent, which suggests a strong outlook for job markets. Fourth quarter Gross Domestic Product was described as “solid”. The meeting minutes indicated that some data typically used by Committee members was limited by the government shutdown.

Inexpensive Updates That Will Appeal To Buyers

February 21, 2019 by Regine Lane

Inexpensive Updates That Will Appeal To Buyers While you could spend tens of thousands of dollars or more completing a home makeover, there are more than a few budget-minded ideas that you may consider.

Add Color To Molding And Trim

One cool idea in home décor and interior design is to get rid of the standard white trim and molding and to add color to these areas. Neutral hues like grays and browns have universal appeal, or you can give your space a more contemporary look by adding black to these areas. Generally, you will want a more neutral color like a creamy beige on the walls when executing a look with colored trim.

Another idea is utilizing a color consistent with your wall color as opposed to a contrasting or complimentary color. This helps the trim blend in and almost disappear. This is an especially effective concept when used in small rooms, narrow halls with several doorways or in rooms with low ceilings.

Update Light Fixtures

If you have a little more money to spend, you may consider updating your light fixtures. There are rather affordable yet stylish fixtures available in a wide range of finishes. When your rooms are empty or staged to perfection, the light fixtures can easily set the tone of the room and may be focal points. Outdated fixtures may have limited appeal to buyers who are looking for a home that is modern and current with today’s trends.

When thinking about lighting, don’t forget to consider updating your outdoor lighting. The right fixtures may add an additional element of curb appeal that many buyers appreciate.

Redefine Outdated Spaces

In some older homes, some of the rooms may have originally been built with outdated uses in mind. Today’s savvy buyers may be looking for a home with an exercise room, a media room or a study rather than a formal living or dining area. With this in mind, you may consider how you can stage your home to show that it can be used for modern purposes.

This may simply mean moving your formal dining room set into storage, adding French doors and investing in an affordable desk and side chairs for staging purposes. Murphy beds that offer space for guests that can be hidden away when not in use are a clever way to show dual purpose. Turning a closet or the area under the stairs into a small office is also a clever use of space.

Whether you are interested in refinancing your current property or purchasing a new property, be sure to contact your trusted home mortgage professional for the most current financing options.

What’s Ahead For Mortgage Rates This Week – February 25th, 2019

FOMC Meeting Minutes: Why Fed’s Rate Policy Reversed Course

Inexpensive Updates That Will Appeal To Buyers

The Latest Articles

Our Location