Maryland Mortgage Rates Weekly Market Update for the Week of September 30, 2013 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 moved lower again this week as talk of a US government shut moved money into the bond market.  If you look at the mortgage bond chart below you can see mortgage bonds were able to rally through the long term resistance which is the blue line in the graph which allowed home loan rates to move lower this week.  The long term trend of mortgage bonds moving lower has been broken and the short term trend now is for bonds to move higher.  We are recommending FLOATING your Maryland mortgage rate to start the week to see if mortgage bonds can continue to rally.

Mortgage Bond Chart 09-27-2013

In Housing News:

Pending Homes Sales of Existing Homes in U.S. for August 2013 decreased by 1.6%.  Pending Home Sales is a leading indicator so we are expecting Existing Home Sales for September to Decline.  The big driver for the slow down in sales is the steep rise in mortgage interest rates.  New Home Sales for August 2013 rebounded from a July dip and are up 8% to 421,000 units.  The Case Schiller 20 City Home Index for July 2013 showed a 12.4% increase from July 2012 and was up 1.8% from June to July of this year.


FHA Update from HUD – HUD announced a delay in implementing their rule for short sales that was to take effect on October 1, 2013.  NAR was successful in lobbying for the delay as the rule would make it illegal for dual agency on short sales that involve the short sale of a FHA loan.  The problem is the definition of dual agency is that no other agent from the same company could represent the buyer and the seller.

In Economic News:

The U.S. Government is facing a shut down over the looping Debt Ceiling.  If Congress doesn’t pass a bill raising the debt ceiling then the US will no longer be able to borrower to pay its bills.  The uncertainty around these debts in Congress has helped boost the bond market and lower mortgage interest rates last week.

The final GDP for Q2 was released at 2.5% down from previous reading of 2.7%. This shows the economy is limping along with no much growth and predictions are even worse for the second half of 2013.  We also saw the release of Consumer Sentiment and it was down to 77.5 in August 2013 from 82.1 in July.  Consumer Confidence was also down coming in at 79.7 which was the lowest reading since May 2013.

Inflation still remains tame as the Personal Consumption and Expenditures (PCE) came in lower at 1.2% and the Consumer Price Index (CPI) also came in lower at 1.5%.  Both of these are under the 2% target for inflation that the Federal Reserve has set.  As long as inflation stays below this target, the Feds can continue their accommodative policies which include low Fed Funds Rate and asset purchase program (QE3).

Consumer Price index August 2013

Thursday we saw the release of the Weekly Initial Jobless Claims which dropped by 5,000 claims to 305,000 claims for the week.  The two states that have been having computer problems have process their backlog so these numbers are accurate reflection of the labor market.  If you look at the chart below you can see that initial jobless claims have been consistently falling and are almost below the 300,000 mark.  This could lead to a better than expected Jobs Report for October 2013 so be on guard as a better Jobs Report could be worse for mortgage rates in the short term.

weekly initial jobless claims 9-26-2013

The Next Free Maryland first Time Home Buyer Seminar is Saturday October 19, 2013 in Towson, Maryland. Register by calling 410-412-3319 or Register online at

John R. Thomas Certified Mortgage Planner – NMLS 38783 Primary Residential Mortgage, Inc. – Baltimore Maryland Mortgage Company 1220A East Joppa Rd Suite 118 Towson, MD 21286 410-412-3319 MD Office

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