Mortgage Blog - April 27, 2020

Last week’s scheduled economic news included readings on sales of new and previously-owned homes and consumer confidence. Weekly readings on mortgage rates and new jobless claims were also released.

COVID-19 Requirements Impact Home Sales

Widespread state and local requirements for sheltering at home negatively impacted home sales in March. New homes sold at an annual pace of 627,000 sales as compared to 741,000 sales reported in February. Analysts estimated 628,000 sales for March according to the Commerce Department.

The National Association of Realtors® reported lower sales of previously-owned homes in March with an annual pace of 5.27 million sales. February’s annual sales rate was 5.76 million homes. Sales of pre-owned homes exceeded analysts’expectations of 5.24 million existing homes sold annually.

Annual sales calculated for March were 8.50 percent lower than February’s reading. Lawrence Yun, the chief economist of the National Association of Realtors®, said that the organization expected home sales to fall in March and expected fewer home sales in April.

The COVID-19 outbreak impacted both home sellers and buyers as restrictions on open houses and home tours limited sellers’ability to show their homes; prospective buyers delayed their home shopping activities due to COVID-19 restrictions and job losses related to business closures.

Mortgage Rates Mixed, Jobless Claims Lower

Freddie Mac reported higher fixed mortgage rates last week; rates for 5/1 adjustable rate mortgages dropped. The average rate for 30-year fixed-rate mortgages rose two basis points to 3.33 percent; rates for 15-year fixed-rate mortgages rose six basis points and averaged 2.86 percent. Rates for 5/1 adjustable rate mortgages fell by six basis points on average to 3.28 percent. Discount points averaged 0.70 percent for fixed-rate mortgages and 0.30 percent for 5/1 adjustable rate mortgages.

First-time jobless claims remained far above average last week but were lower than the prior week. 4.43 million initial unemployment claims were filed last week as compared to 5.24 million claims filed the prior week. Analysts expected a reading of four million new claims filed last week.

April’s Consumer Sentiment Index reading fell to an index reading of 71.8 from the March reading of 89.1 Analysts expected a reading of 69.3. The University of Michigan said that the Index reading from March to April showed the steepest drop in Index history. Analysts said that April’s reading indicated an economic recession.

What’s Ahead for the Week of April 27, 2020

This week’s scheduled economic reports include Case-Shiller Home Price Indices, pending home sales, and the post-meeting statement of the Fed’s Federal Open Market Committee. Fed Chair Jerome Powell will give a press conference after the FOMC statement. Construction spending data will be released along with weekly readings for mortgage rates and new jobless claims.

Tuesday April 28, 2020  Consumer Confidence  April
Wednesday April 29, 2020  GDP Advance  Q1 2020
Wednesday April 29, 2020  Core PCE Prices Advance  Q1 2020
Wednesday April 29, 2020  Pending Home Sales Change  March
Wednesday April 29, 2020  Fed Funds Rate
Thursday April 30, 2020  Personal Income  March
Thursday April 30, 2020  Core PCE Price Index  March
Thursday April 30, 2020  Initial Jobless Claims    Week of April 20
Thursday April 30, 2020  Chicago PMI  April
Friday May 1, 2020  Construction Spending  March
Friday May 1, 2020  ISM Mfg. PMI  April

Have a Great Week!

Scott Synovic
AnnieMac Home Mortgage
Colorado's Mortgage Expert
www.coloradosmortgageexpert.com
#coloradosmortgageexpert
303.668.3350 Direct

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