This quick update on what happened this week in the housing and financial markets in 2015
Economic Update
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Low trading volume and lack of overseas concerns have led to mortgage bond market stability this week. Rates have been less volatile as a result.
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Jobless claims fell to lowest levels seen since 1973. Positive jobs data supports the Fed’s plans for increasing policy rates. -
Oil prices have tumbled to the lowest prices since April. Combined with a strong dollar, this could offset recent employment data and help mortgage rates improve.
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In testimony to Congress, Fed Chair Janet Yellen signaled that the Fed would likely raise policy rates later this year. The first hike is expected in September.
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Retail sales slipped slightly in June, raising some concerns that the economy could be slowing down. Slow economic growth is good for mortgage rates.
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Greece has finally agreed to terms for financial bailout in Europe. The recent turmoil supporting rates will likely no longer be a factor. (What happens in Greece effects our interest rates. )
Housing News
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Existing home sales numbers rose to their highest level in nearly 8-1/2 years in June 2015. The strong housing market recovery supports a Fed policy rate hike this year.
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Although higher prices should be prompting more homeowners to put their homes up for sale, tight supply of properties remains a constraint to the market.
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Freddie Mac released their 2015 U.S. Housing Market Insight & Outlook for July. Both housing starts and prices are expected to continue to rise.
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The NAHB reports builder confidence at the highest level since 2005. More builders are optimistic about current and future sales conditions for new homes.
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Foreclosure activity was at the lowest level in a decade during the first half of 2015. Foreclosure starts are below pre-crisis levels, signaling housing market strength.
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First-time buyers are gaining confidence and continue to join the housing market. Their participation has increased from 27% to 32% of the market year-over-year.
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Sales in Southern California are up 9.5% since January 2015
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