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Mortgage Rates Steady
On Friday the Commerce Department reported the US economy grew by 4.1% during the second quarter. This was the strongest growth since the third quarter of 2014.
Normally good news for the economy is bad news for mortgage rates. However, analysts had been expecting an even stronger number so home loan rates remained steady.
Pending Home Sales
The National Association of Realtors released its monthly pending home sales report today. It showed that the the number of homes currently in contract increased month-over-month (+.9%) but is still down year-over-year (-2.5%).
If you’ll remember last week the existing home sales report showed a slight increase to the supply of homes which may explain why we see more pending sales. The trends in the housing market continue to suggest a more balanced market ahead.
Fed officials will meet this week and make a decision about short-term interest rates. The markets currently expect the Fed to hold steady at this meeting but hike short-term rates by .25% at the September meeting.
Even if the Fed does not hike rates their comments can still impact mortgage rates.
The Week Ahead
This week’s economic calendar is busy.
On Tuesday we’ll get the latest Case-Shiller Home Price Index report and the Fed’s favorite gauge of inflation (Personal Consumption Expenditure price index). On Wednesday we get the aforementioned Fed announcement and on Friday the all-important jobs report.
Current Outlook: locking