Maryland Mortgage Rates Weekly Market Update for the Week of October 27, 2014 from John R. Thomas with Primary Residential Mortgage in Towson, Maryland. John is the author of the book, Your Guide to Purchasing Your First Home in Maryland. Call 410-412-3319 to get a free mortgage planning consultation or APPLY ONLINE for Maryland mortgage loan.
Maryland Mortgage Rates ended the week about where they started as mortgage bonds have traded in sideways pattern. If you look at the mortgage bond chart below you can see mortgage bonds have been trapped between the two blue lines which has kept Maryland mortgage rates about the same for the past week. The long green line was a very large spike higher for the bond and was very short lived drop in mortgage rates into the 3% range. The spike didn’t even last for the day as mortgage bonds sold off. The media has jumped on what happened that particular day when talking about rates but as you can see from the chart bonds have since been trading in the same range as before the spike. We are recommending cautiously FLOATING your Maryland Mortgage Rate to start the week because of the sideways pattern but be very mindful that a rallying in the stock market could cause mortgage bonds to break below the blue line of support.
In Economic News, Mortgage bonds have been trading at the high for the year because of a flight to bonds for the world economy with concerns over Ebola, weak economic data in the U.S., the Feds ending their bond buying program, and a weak global economy. This has all helped mortgage rates reach an 18 month low.
Weekly Initial Jobless Claims were reported on Thursday at 283,000 claims which is up 17k claims from the previous week but still well below the 300k mark. The jobless claims point to a strong October Jobs Report with over 200,000 jobs created for October. Strong job creation is usually bad for mortgage bonds in the short term so we will keep you updated as we move closer to the report.’
The Consumer Price Index (CPI) for September 2014 was up only 0.1% and the year over year CPI is only 1.7%. The CPI measures inflation at the consumer level, so this shows inflation remains very tame which is good news for mortgage bonds. If inflation starts to heat up, that could cause mortgage bonds to sell off and interest rates would move higher.
In Housing News, Existing Home Sales for September 2014 were released last week and showed 5.17 Million units sold which is up 2.4% from August Existing Home Sales of 5.05 Million Units. This was stronger than expected and was the best existing homes sales report for the entire year of 2014. The median existing home sales price was reported at $209,000 which is up 5.6% year over year. Additionally the inventory of homes for sale nationwide declined a bit to a 5.3 month supply. Distressed sales dropped by 10% nationally.
New Home Sales for September 2014 were reported last week and came in 467,000 units on annualized basis which was a 6 year high and up to 0.2% from August. The bad news in the report was that New Home Sales for August was actually revised lower from 504,000 units to only 466,000 units and July and June were revised lower as well. The median home price for New Home Sales was $259,000.
The Federal Housing Finance Agency (FHFA) announced it is going to try to ease credit overlays in the housing industry and the first step is they are bringing back loans with Loan to Value (LTV) of up to 97% for Fannie Mae Loans. Freddie Mac is expected to follow suit once Fannie rolls this out. There is no date set for this yet but that would allow borrowers better options with less money down versus going with an FHA Loan. Currently Fannie and Freddie require you to put down a minimum of 5%
USDA Rural Housing Loans Update – You can check which day Rural Development is underwriting files from by checking out this website:
.As of Friday October 24, 2014, Rural Development was underwriting files that were submitted on 9/24/2014.
APPLY ONLINE today to be pre-approved for a mortgage to buy your first home in Maryland. Primary Residential Mortgage is an approved lender for the Maryland CDA Program
John R. Thomas
Loan Officer – FHA, VA & USDA Specialist – NMLS – 38783
Primary Residential Mortgage, Inc. – Baltimore Maryland Mortgage Company
1220A E Joppa Rd
Towson, MD 21286
410-412-3319 MD Office
302-703-0727 DE Office
610-906-3109 PA Office