Jude's Real Estate Rumblings

New Housing Index Reaches Best Level in 2 Years:
The National Association of Home Builders announced that their Housing Market Index which measures builder's sentiment and outlook for the industry jumped 5 points in April to a reading of 19.  This is the highest reading in 24 months.  The survey of 417 residential developers also showed that foot traffic from prospective buyers rose 4 points.

In a separate report, nationwide housing starts rose for the third consecutive month to a seasonally adjusted 626,000 units according to the U.S. Commerce Department.  Requests for  new housing permits also rose.  They increased to an annual rate of 685,000 units.

Federal Reserve Report Shows Economic Strength:
The Federal Reserve released their Beige Book last week.  This report (named for the color of its binder) showed that "economic activity increased somewhat" in 11 out of 12 federal districts.

The results of the Fed's  new survey is consistent with chairman Ben Bernanke's view that a modest recovery is unfolding, although it won't be strong enough to materially drive down unemployment rates for some time.

The new survey suggested that consumers, whose spending accounts for 70 percent of national activity, are doing their part to keep the recovery going.  Retailers in most parts of the country reported sales increases and merchants were "cautiously optimistic regarding future sales". 

What Happened to Rates Last Week:


Mortgage backed securities (MBS) gained +44 basis points last week which caused 30 year fixed rates to decrease for both government and conventional loans.  MBS pricing improved due to a weak Consumer Sentiment report, a jump in Initial Weekly Jobless Claims, continued concern over Greece's solvency and a massive market shake-up that resulted from the new Goldman-Sachs charges.

What to Watch Out For This Week:
The following are the major economic reports that will hit the market this week.  They each have the ability to affect the pricing of Mortgage Backed Securities and therefore, interest rates for Government and Conventional mortgages.  I will be watching these reports closely for you and let you know if there are any big surprises:

I know you are busy and it is virtually impossible for you to keep track of what is going on with the economy and other events that can impact the housing and mortgage markets.  Just leave it to me, I monitor the live trading of Mortgage Backed Securities which are the only thing government and conventional mortgage rates are based upon. 

The Mortgage Network
600 South Cherry Street Suite 143, Denver CO, 80246
Phone: 303-394-2121