Florida mortgage markets looked better last week as foreign investors buying up mortgage debt helped to move mortgage rates to a 4-week low. With rates improving for the 3rd continuous week, this year’s ongoing Refi boom got another shot in the arm.
Fixed-rate, conforming mortgage rates dropped roughly 0.125 percent on the week. ARMs did about the same.
With little in the way of economic data last week, investors worked mostly on momentum and trends. However, the Friday University of Michigan Consumer Sentiment survey release did capture Wall Street’s attention.
After taking hits in August and September, consumer sentiment fell for the third straight month – according to October’s report.
Needless to say, with the Holiday Shopping season here, analysts are concerned about what this drop may mean for our national financial picture. As we know, consumer spending fuels the economy. If households hold the purse strings tight, our nation’s budding economic recovery may stall.
In a scenario like that, employment rates won’t rebound with any sort of speed, but rate shoppers might not mind. Slower-than-expected economic growth tends to suppress mortgage rates, helping to improve home affordability overall.
News for the Week Ahead
Today, the government released the October 2009 Retail Sales report. Numbers showed sales up 1.4 percent overall. Watch for this to potentially cause upward pressure on mortgage rates.
Then, on tomorrow and Wednesday, look for PPI and CPI — two key inflation indices. Inflation causes mortgage rates to rise so if either of these reports comes in hotter-than-expected, rates will almost certainly rise.
And, lastly, also on Wednesday, we’ll get the Housing Starts report for October. Don’t expect the markets to move on this one, but keep an eye on the data anyway. Housing markets remain crucial to economic recovery.
Despite rates hovering near recent lows, remember that markets change quickly. A rate quote from the morning is rarely valid by the afternoon and, when rates rise, rates rise fast.
I hope you found this post useful! As always, if you or anyone you know is in need of a local Florida mortgage broker, I’m your guy. Call me at 863-604-3019 or apply online for your Florida mortgage. We’ll keep you posted and let you know when it’s time to pull the trigger!
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