Mortgage rates have remained more or less steady all week. Mixed economic data and a lack of news out of Europe is helping rates here in the US to remain .125%-.25% off all-time low levels.
This morning’s weekly jobless claims figures were lower than expected but if you’ll remember back to last week they were reported higher than expected so in the end its a wash. A separate report showed that durable goods orders increased by more than expected in September but like weekly jobless claims the prior report had disappointed.
In housing news the the National Association of Realtors reported slower than expected gains in pending homes sales for September.
However, on a year-over-year basis pending homes sales increased by 14.5%. This marks the 17th straight month of year-over-year gains. A separate report released on Tuesday showed that housing prices across the US increased by an average of 4.7% from last year. All indicators suggest the housing market is making a compelling rebound.
Since mortgage rates have increased by .125%-.25% from all-time lows there are some analysts calling for rates to continue to rise. Should economic data continue to improve and the mess in Europe remain calm they could be right. However, there are still significant uncertainties. The fiscal cliff is a major threat to the economic recovery and until the results of the election are known it will be difficult to speculate on how that will play out. I believe rates will remain fairly stable until the election and will shift to a neutral stance.
Current Outlook: neutral