CHM Blog

Real Estate Market Insider January 31, 2022

January 31st, 2022 1:02 PM by Richard Sardella MLO.100007700/NMLS 233568

Rates At a Glance
Mortgage Rates
Currently Trending
7 Day Mortgage
Rate Forecast
This Week's
Potential Volatility



(by Sigma Research)
Real Estate Report

New Home Sales Jump.

According to The U.S. Census Bureau and the U.S. Department of Housing and Urban Development: Sales of new single family houses in December 2021 were at a seasonally adjusted annual rate of 811,000, according This is 11.9 percent (±20.3 percent) above the revised November rate of 725,000, and much higher than the consensus estimates of 760,000 units.

The median sales price of new houses sold in December 2021 was $377,700. The average sales price was $457,300.

The seasonally adjusted estimate of new houses for sale at the end of December was 403,000. This represents a supply of 6.0 months at the current sales rate.

This Week's Mortgage Rate Summary

How Rates Move:

Conventional and Government (FHA and VA) lenders set their rates based on the pricing of Mortgage-Backed Securities (MBS) which are traded in real time, all day in the bond market.  This means rates or loan fees (mortgage pricing) moves throughout the day, being affected by a variety of economic or political events.  When MBS pricing goes up, mortgage rates or pricing generally goes down.  When they fall, mortgage pricing goes up.  Tracking these securities real-time is critical.  For more information about the rate market, contact me directly.  I’m among few mortgage professionals who have access to live trading screens during market hours.

Rates Currently Trending: Neutral

Mortgage rates are moving sideways today. The MBS market improved by +10 bps last week. This was not enough to improve mortgage rates or fees. The market experienced high volatility last week.

This Week's Rate Forecast: Higher

Three Things: These are the three areas that have the greatest ability to impact rates this week: 1) Central Banks, 2) The Fed and 3) Jobs.

1) Central Banks: The market expects that the Bank of England will raise their interest rate at this Thursday's meeting which would be important as a top 5 Central Bank. We also hear from the ECB but the market is not expecting any rate action from them. The Reserve Bank of Australia rounds out our central banking action.

2) The Fed: After last week's FOMC meeting, the bond market is very keen to hear from this week's speakers for hints on the path, speed and number of rate hikes this year. Will the Fed kick us off with a 50BPS hike in March or 25BPS? Will there be 3 or 7 rate hikes? When will QT really begin?

3) Jobs: It will be Big Jobs Friday this week. We get a ton of job and wage related data all through the week with internal components of ISM, ADP, Challenger Job Cuts, Initial Weekly Claims, JOLTS, Non Farm Payrolls, Average Hourly Earnings, Unemployment Rate, U6 Underemployment Rate and more.

This Week's Potential Volatility: High

This morning we are seeing some selling after two days of gains. Volatility is high without major economic news.

Bottom Line:

If you are looking for the risks and benefits of locking your interest rate in today or floating your loan rate, contact your mortgage professional to discuss it with them.

About Richard Sardella

Richard Sardella has been actively managing and providing services in the mortgage industry for over 30 years. Richard serves on the board of directors as President of Colorado Home Mortgages Inc.

About This Report And Disclosure Information

All information furnished has been forwarded to you and is provided by thetbwsgroup only for informational purposes. Forecasting shall be considered as events which may be expected but not guaranteed. Neither the forwarding party and/or company nor thetbwsgroup assume any responsibility to any person who relies on information or forecasting contained in this report and disclaims all liability in respect to decisions or actions, or lack thereof based on any or all of the contents of this report.

MLO of record MLO.100007700 / NMLS#233568 / CHM NMLS#127716.

Posted by Richard Sardella MLO.100007700/NMLS 233568 on January 31st, 2022 1:02 PM



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