Tuesday's bond market has opened in positive territory after this morning's economic news showed results that were mostly favorable to bonds. The stock markets are showing losses with the Dow currently down 60 points and the Nasdaq down 4 points. The bond market is currently up 20/32, which should improve this morning's mortgage rates approximately .250 of a discount point.

The Labor Department gave us today's first and most important data of the day with the release of May's Producer Price Index (PPI). It showed a whopping 1.4% increase in the overall index that was higher than expected, however, the more important core data reading matched forecasts of a 0.2% increase. This means that volatile food and energy prices rose more than expected, but that with those figures excluded, price remained close to expectations.

The second was May's Housing Starts report that showed a lower number of starts than analysts had expected. This is generally good news for the bond market because it gives us an indication of housing sector strength and weak housing has contributed greatly to the economic slowdown. However, this data is not considered to be of high importance to the markets.

The third and final piece of data also showed weaker than expected economic activity. May's Industrial Production was released mid-morning and revealed a 0.2% decline in manufacturing output. The 0.3% variance between forecasts and the actual reading is fairly large for this report and is contributing somewhat to the bond gains despite the data being considered moderately important.

There is no relevant economic news scheduled for release tomorrow. May's Leading Economic Indicators (LEI) will be posted late Thursday morning. The Conference Board, who is a New York-based business research group, will post this data. It attempts to predict economic activity over the next three to six months. If it shows rapidly rising levels of activity, bond prices will probably drop, pushing mortgage rates higher Thursday morning. But, a weaker than expected reading could lead to lower mortgage pricing. It is expected to show no change from April to May.

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... This is only my opinion of what I would do if I were financing a home. It is only an opinion and cannot be guaranteed to be in the best interest of all/any other borrowers.

©Mortgage Commentary 2008
Posted by Melanie Cooper - Team Lead/Listing Specialist on June 17th, 2008 9:06 PMPost a Comment (0)

Take Advantage of the Low Rates....NOW...before it's too late!
June 16th, 2008 5:16 PM

TOP STORY: Rates creep up

A recent survey and a rate increase could mean more competition for homes

Recent indication is that first time home buyers are getting tired of sitting on the sidelines. According to a recent online poll taken by the National Apartment Association, 17 percent of renters plan to make the jump to home ownership in the next year; 41 percent of the 2,041 respondents planned to be home owners within two years. Only 31 percent planned to still be paying rent five years from now.

Another factor that could very soon contribute to an increase in home buying could be rising mortgage costs. Fixed-rate mortgage rates rose to 6.32 percent, the highest it has been since October. After months of aggressively dropping interest rates, many lenders are worried that the Fed will be forced to raise rates back up. As interest rates rise, so do mortgage rates. According to a press release on freddiemac.com, Frank Nothaft, Freddie Mac vice president and chief economist said that, "Mortgage rates jumped this week after a number of Federal Reserve officials, most notably Chairman [Ben] Bernanke and Vice Chair [Donald] Kohn, expressed concern over a threat of inflation." We may very well be seeing the beginning of the end of the super-low mortgage and potential buyers may realize that with rising rates, now may be the time to jump in. Nothaft added, "Moreover, pending home sales for April unexpectedly rose by 6.3% and mortgage applications for home purchases ... were also up last week."

Posted by Melanie Cooper - Team Lead/Listing Specialist on June 16th, 2008 5:16 PMPost a Comment (0)

Take Advantage of Low Rates NOW!
June 16th, 2008 3:19 PM

TOP STORY: Rates creep up

A recent survey and a rate increase could mean more competition for homes

Recent indication is that first time home buyers are getting tired of sitting on the sidelines. According to a recent online poll taken by the National Apartment Association, 17 percent of renters plan to make the jump to home ownership in the next year; 41 percent of the 2,041 respondents planned to be home owners within two years. Only 31 percent planned to still be paying rent five years from now. 

Another factor that could very soon contribute to an increase in home buying could be rising mortgage costs. Fixed-rate mortgage rates rose to 6.32 percent, the highest it has been since October. After months of aggressively dropping interest rates, many lenders are worried that the Fed will be forced to raise rates back up. As interest rates rise, so do mortgage rates. According to a press release on freddiemac.com, Frank Nothaft, Freddie Mac vice president and chief economist said that, "Mortgage rates jumped this week after a number of Federal Reserve officials, most notably Chairman [Ben] Bernanke and Vice Chair [Donald] Kohn, expressed concern over a threat of inflation." We may very well be seeing the beginning of the end of the super-low mortgage and potential buyers may realize that with rising rates, now may be the time to jump in. Nothaft added, "Moreover, pending home sales for April unexpectedly rose by 6.3% and mortgage applications for home purchases ... were also up last week."

Posted by Melanie Cooper - Team Lead/Listing Specialist on June 16th, 2008 3:19 PMPost a Comment (0)

DAILY LOCK ADVISORY 6/5
June 5th, 2008 12:41 PM

Thursday's bond market has opened in negative territory again as investors prepare for tomorrow's big news. Also hurting bonds this morning are sizable stock gains that has the Dow up 128 points and the Nasdaq up 30 points. The bond market is currently down 8/32, which with yesterday's late sell-off, will push this morning's mortgage higher by approximately .500 of a discount point compared to yesterday's morning rates.

The only data posted this morning was last week's unemployment claims. The Labor Department said that 357,000 new claims for benefits were filed last week. This was lower than the 372,000 that was expected and created some concern in the bond market that tomorrow's monthly report may reveal stronger than expected numbers.

The Labor Department will post May's Employment data early tomorrow morning. This report gives us key employment readings such as the U.S. unemployment rate and the number of jobs added or lost during the month. Analysts are expecting to see the unemployment rate climb to 5.1% with approximately a loss of 60,000 jobs during the month. A higher than expected increase in the unemployment rate and a larger drop in payrolls would be great news for the bond market. It would probably create a sizable rally in bonds, leading to lower mortgage rates tomorrow.

But, if we see stronger than expected numbers in tomorrow's results, we will likely see bonds tumble and mortgage rates spike higher. There is little doubt that tomorrow's news will create volatility in the markets and quite possibly mortgage pricing. Accordingly, proceed with caution if still floating an interest rate.

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 ... This is only my opinion of what I would do if I were financing a home. It is only an opinion and cannot be guaranteed to be in the best interest of all/any other borrowers.

©Mortgage Commentary 2008

Posted by Melanie Cooper - Team Lead/Listing Specialist on June 5th, 2008 12:41 PMPost a Comment (0)

St. Louis Real Estate Blog

A great community comes out to fight the rising waters.
June 5th, 2008 12:38 PM

As many of you know this past week was rather challenging for those of us that live and work along the I-44 corridor.  I was amazed at the community outreach I witnessed and participated in while filling sandbags in Eureka.  Here is my account of events.

I arrived at the sand pile Thursday morning not knowing what to expect.  I didn't see any request for volunteers on the news or in any other media outlet, but I figured there would be a call to arms for all the great people of Eureka.  Boy was I right.  Lots of sand, shovels, and people.

The first few folks that greeted me is somone I knew would be there.  Laurie and Jan from Long Ford.  Whenever Eureka needs something from its residents you can usually find these 2 involved in one way or another.  After a brief exchange of greetings it was time to get to work. 

The pile of sand was surrounded by community leaders, residents, and buisness leaders alike.  All were busy either holding the bags open, shoveling the sand, tying the bags, or loading the trucks.  I was asked to pull my truck up to the pile and have it loaded with about 80 bags.  I gladly agreed.  

My first load of sand was dropped at a local buisness who had just started preparing for the forecasted crest at the time.  There I met Cathy and I quickly unloaded the bags and headed back for more.  I promised Cathy more help as I was pulling out.   

 

Posted by Melanie Cooper - Team Lead/Listing Specialist on June 5th, 2008 12:38 PMPost a Comment (0)

Daily Rate Lock Advisory 6/20/08
June 20th, 2008 4:08 PM

 7 days   20 days                60 days

Friday's bond market has opened in positive territory following noticeable stock losses. The stock markets are in negative territory following concerns about financial sector and rising oil prices. The result is the Dow down 127 points and the Nasdaq down 38 points. The bond market is currently down 16/32, but we likely will see little change in this morning's mortgage rates due to weakness in bonds late yesterday.

There is no relevant economic data being posted today. As expected, stock prices are influencing bond trading. As long as the stock markets do not stage a rally and recover their early losses, I am expecting bond prices to remain fairly calm and mortgage rates to stay at this morning's levels. If the major stock indexes fall further, we may see enough improvement in bonds for mortgage rates to revise lower this afternoon.

Next week is fairly busy with economic releases, not only in terms of the number of reports scheduled for relea se, but also the importance of some of them. We will see data on consumer confidence, manufacturing sector strength, housing sales and the final reading of the 2nd Quarter GDP. We also have the next FOMC meeting to be concerned about that will likely bring volatility to the markets and mortgage rates.

There is no relevant economic data scheduled for release Monday, but Tuesday does bring one of the more important reports of the week. Monday is also the only day of the week with no relevant news or data scheduled to be posted. Look for more details on next week's events in Sunday's weekly preview.

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... This is only my opinion of what I would do if I were finan cing a home. It is only an opinion and cannot be guaranteed to be in the best interest of all/any other borrowers.

©Mortgage Commentary 2008
Posted by Melanie Cooper - Team Lead/Listing Specialist on June 20th, 2008 4:08 PMPost a Comment (0)

Daily Rate Lock Advisory 6/17/08
June 17th, 2008 9:06 PM

 7 days   20 days                60 days
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