Mortgage Rate Update February 25, 2016

Mortgage rates are similar or slightly better compared to Monday.

China’s stock market plunged for the second time this year.  The Shanghai Composite Index fell by 6.4% today as investors showed concern for the state of the Chinese economy.  The volatility in China has redirected capital into the US debt markets which helps rates move lower (click HERE to learn how).

In case you missed it Portland led the country in year-over-year home price appreciation according to the latest Case-Shiller Home Price Index report that was released on Tuesday.  According to the report home prices rose by 11.4% from December 2014 to December 2015.  Some onlookers have begun to ask if a bubble is forming here in Portland.  Click HERE to see why we’re not there…..but not ruling it out in the future.

In other housing data, the National Association of Realtors NAR released monthly data on existing home sales.  Nationally home sales increased to a 6 month high.  However, the number of home sales actually decreased in the West Region from December to January (still higher on a year-over-year basis).  A lack of supply was blamed.

NAR chief economist Lawrence Yun commented, “The spring buying season is right around the corner and current supply levels aren’t even close to what’s needed to accommodate the subsequent growth in housing demand.”  You can say that again.

From a technical perspective the outlook looks modestly positive.  I will shift to a floating bias.

Current Outlook: floating bias