Mortgage Market Weekly – Update Mar 2, 2015

In This Issue…

Last Week in Review: Recent housing reports have disappointed, but sales of new and existing homes are up from this time a year ago.

Forecast for the Week: The Jobs Report for February is a must-watch. Also look for news on inflation, personal income and spending, and manufacturing.

View: Boost new ideas and creative thinking with these four tips.

[Read more…]

Mortgage Market Weekly – Update Dec 22, 2014

In This Issue…

Last Week in Review: While lower oil prices are giving people reason to cheer, there was some disappointing news in the housing sector.

Forecast for the Week: A full slate of economic reports will be released ahead of the Christmas holiday.

View: Saying “no” can be easy with these five tips.

Last Week in Review

“You make me wanna (Shout!)” These days, many people are shouting for joy as gas prices continue to plunge. But was the rest of the week’s news cause to celebrate? Read on for details.

consumer-price-index_2014-12-19Falling gas prices were definitely a key factor leading consumer prices lower in November, as the Consumer Price Index fell by 0.3 percent. The inflation-reading gauge posted its largest monthly decline in six years. Low inflation is good news for Bonds, as inflation reduces the value of fixed investments like Bonds. This means low inflation is also good news for home loan rates, which are tied to Mortgage Bonds.

Over in the housing sector, November Housing Starts fell by 1.6 percent from October to an annual rate of 1.028 million units. Single-family starts fell 5.4 percent, while the volatile multi-family segment rose by 6.7 percent. Building Permits in November also declined. Despite these decreases, the housing sector has been improving overall. In addition, the recent strong Jobs Report for November is a good sign for economic growth next year—and that should help the housing sector continue its otherwise improving trend.

Also of significance: The Fed held its last Federal Open Market Committee meeting of 2014, and it noted that it will keep the Fed Funds Rate (the rate banks use to lend money to each other overnight) low until it feels that the economy can function normally with higher rates. This led to a rally in Stocks, while Mortgage Bonds and home loan rates remain near 18-month bests.

The bottom line is that home loan rates remain near some of their best levels of the year, and now is a great time to consider a home purchase or refinance. Let me know if I can answer any questions at all for you or your clients.

Forecast for the Week

The first half of the week will be busy, with key reports on housing, inflation and economic growth.

  • In the housing sector, Existing Home Sales for November will be released on Monday. November New Home Sales follow on Tuesday.
  • The final reading on third quarter Gross Domestic Product will be closely watched when the numbers are delivered on Tuesday.
  • Tuesday also brings several more key reports, including the Consumer Sentiment Index, Durable Goods Orders, Personal Income, Personal Spending and Personal Consumption Expenditures (the Fed’s favorite measure of inflation).
  • Weekly Initial Jobless Claims will be released on Wednesday instead of Thursday due to the Christmas holiday.

The Stock markets will close early at 1:00 p.m. EST on Wednesday, December 24, while the Bond markets will be closing at 2:00 p.m. EST. All markets will be closed on Thursday, December 25 in observance of Christmas. On Friday, December 26 there will be normal market hours.

Remember: Weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bonds and home loan rates improve, while strong economic news normally has the opposite result. The chart below shows Mortgage Backed Securities (MBS), which are the type of Bond on which home loan rates are based.

When you see these Bond prices moving higher, it means home loan rates are improving and when they are moving lower, home loan rates are getting worse.

To go one step further a red “candle” means that MBS worsened during the day, while a green “candle” means MBS improved during the day. Depending on how dramatic the changes were on any given day, this can cause rate changes throughout the day, as well as on the rate sheets we start with each morning.

As you can see in the chart below, Mortgage Bonds remain near 18-month highs, meaning home loan rates are still hovering near historic lows.

Chart: Fannie Mae 3.5% Mortgage Bond (Friday Dec 19, 2014)

mortgage-bonds_2014-12-19

The Mortgage Market Guide View…

5 Ways to Say No

The holidays aren’t the only time of year people over-commit themselves and being able to say no isn’t always easy. But there are ways to say no that make all the difference, and can help you preserve both your sanity and your relationships.

Christine Carter, Ph.D., sociologist, happiness expert at UC Berkeley’s Greater Good Science Center, and author of “The Sweet Spot: How to Find Your Groove at Home and Work” (coming January 2015) offers five effective ways to say no:

  1. Vague but effective: “Thank you for asking, but that isn’t going to work out for me.”
  2. Ask me later: “I want to do that, but I’m not available until April. Will you ask me gain then?”
  3. Keep trying: “None of those dates work for me, but I would love to see you. Send me some more dates.”
  4. Try me last minute: “I can’t put anything else on my calendar this month, but I’d love to do that with you sometime. Will you call me right before you go again?”
  5. Gratitude: “Thank you so much for your enthusiasm and support! I’m sorry I’m not able to help you at this time.”

If you’d like to find out even more effective ways you can say no, read Carter’s full article 21 Ways to “Give Good No.”

Please feel free to pass these great tips along to your team, clients and colleagues!

Source: Greater Good Science Center

econ-calendar=2015-02-17_16-19-12

The material contained in this newsletter is provided by a third party to real estate, financial services and other professionals only for their use and the use of their clients. The material provided is for informational and educational purposes only and should not be construed as investment and/or mortgage advice. Although the material is deemed to be accurate and reliable, we do not make any representations as to its accuracy or completeness and as a result, there is no guarantee it is without errors.

As your mortgage professional, I am sending you the MMG WEEKLY because I am committed to keeping you updated on the economic events that impact interest rates and how they may affect you.

In the unlikely event that you no longer wish to receive these valuable market updates, please USE THIS LINK or email: don@donparsons.com

If you prefer to send your removal request by mail the address is:

Don Parsons
Commerce Mortgage – NMLS 2105
450 Newport Center Drive Suite 350
Newport Beach, CA 92660
2130 Main Street Suite 260
Huntington Beach, CA 92648

Mortgage Market Weekly – Update Aug 25, 2014

In This Issue…

Last Week in Review: Key reports indicate that the housing recovery is back on track, while inflation remains tame.

Forecast for the Week: August ends on a busy note, with important reports on housing, inflation, economic growth and more.

View: Need some extra help at the office? Check out these six steps for hiring an intern.

Last Week in Review

“There is nothing as sweet as a comeback.” Anne Lamott. That’s certainly true when it comes to the housing sector, as recent reports indicate that the stall in the housing recovery seen late last year and in recent months may be over.

housing-starts_2014-08-22Housing Starts for July surged by nearly 16 percent to an annual rate of 1.093 million, above expectations and up from the 945,000 in June. Building Permits, a sign of future construction, also came in above expectations while Existing Home Sales for July increased by 2.4 percent from June.

In addition, the National Association of Home Builders Housing Market Index, which is a measure of builder confidence, rose two points to 55 in August from the 53 recorded in July. This was the third straight monthly gain and brings the index to its highest level since the 56 recorded in January. As a rule, 50 is the line between positive and negative sentiment. All in all, these reports are a good sign that the housing sector is coming back strong.

In other news, despite signs earlier this summer that inflation may be heating up, the latest reports show that inflation at the consumer level remains tame. This is good news for Bonds, as inflation reduces the value of fixed investments like Bonds. And since home loan rates are tied to Mortgage Bonds, tame inflation is typically good news for home loan rates as well.

The bottom line is that home loan rates remain near some of their best levels of the year and now is a great time to consider a home purchase or refinance. Let me know if I can answer any questions at all for you or your clients.

Forecast for the Week

The economic calendar is packed this week with key housing, inflation, manufacturing and economic growth data.

  • Housing news kicks off the week with July New Home Sales on Monday. The S&P/Case-Shiller Home Price Index follows on Tuesday, with Pending Home Sales for July being reported Thursday.
  • We’ll get a sense of how consumers are feeling with Consumer Confidence on Tuesday and the Consumer Sentiment Index on Friday.
  • Look for Durable Goods Orders (i.e. orders for items that last for an extended period of time) on Tuesday.
  • Important news is ahead Thursday with the second reading of second quarter Gross Domestic Product.
  • Weekly Initial Jobless Claims will also be reported on Thursday. Claims continue to hover near the 300,000 mark.
  • Friday wraps up the week with Personal Income, Personal Spending and Personal Consumption Expenditures, the Fed’s favorite measure of inflation. Regional manufacturing news via the Chicago PMI will also be reported.

Remember: Weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bonds and home loan rates improve, while strong economic news normally has the opposite result. The chart below shows Mortgage Backed Securities (MBS), which are the type of Bond on which home loan rates are based.

When you see these Bond prices moving higher, it means home loan rates are improving and when they are moving lower, home loan rates are getting worse.

To go one step further a red “candle” means that MBS worsened during the day, while a green “candle” means MBS improved during the day. Depending on how dramatic the changes were on any given day, this can cause rate changes throughout the day, as well as on the rate sheets we start with each morning.

As you can see in the chart below, Mortgage Bonds improved in the latter part of the week despite the positive housing data. Home loan rates remain near some of their best levels of the year and I’ll continue to monitor them closely.

Chart: Fannie Mae 4.0% Mortgage Bond (Friday Aug 22, 2014)

aug22-bonds-chart

The Mortgage Market Guide View…

6 Steps for Hiring an Intern

Hiring an intern is a win-win. The intern gains valuable skills and experience. You gain extra help on a temporary basis. Follow these six steps to hire an intern:

  1. Create a clear, meaningful job description. Do you need someone to focus on a special project or a social media coordinator to expand your social media outreach? Include the time commitment (usually up to 20 hours per week) and preferred work hours. Finally, outline the compensation (e.g., hourly wage or stipend).
  2. Recruit candidates. Turn to social media, your networks, and local colleges and universities. Provide the job description for reference.
  3. Prepare a workspace. Your intern will need a computer and a comfortable space. A phone may be necessary if the intern is calling contacts on your behalf.
  4. Plan for mentoring and supervision. Your intern will be learning everything from job responsibilities, to appropriate dress code, to performance expectations, and office protocol. Plan for guidance every step of the way.
  5. Give specific feedback. Concrete praise encourages a repeat performance. Concrete constructive feedback allows for corrective action. If you work with a college, you may have additional requirements of reporting to an internship coordinator or having a site visit.
  6. Offer to be a reference. Internships aren’t expected to lead directly to a job with the host company. Offer to be a reference and speak about your interns’ job responsibilities and strengths with their prospective employers.

As always, please feel free to pass these tips along to your team, colleagues and clients.

Sources: Forbes.com, inc.com, internprofits.com, sba.gov

Economic Calendar for the Week of August 25 – August 29

economic-chart-aug22

The material contained in this newsletter is provided by a third party to real estate, financial services and other professionals only for their use and the use of their clients. The material provided is for informational and educational purposes only and should not be construed as investment and/or mortgage advice. Although the material is deemed to be accurate and reliable, we do not make any representations as to its accuracy or completeness and as a result, there is no guarantee it is without errors.

As your mortgage professional, I am sending you the MMG WEEKLY because I am committed to keeping you updated on the economic events that impact interest rates and how they may affect you.

Don Parsons
Commerce Mortgage – NMLS 2105
450 Newport Center Drive Suite 350
Newport Beach, CA 92660
2130 Main Street Suite 260
Huntington Beach, CA 92648

Mortgage Market Weekly Update – April 29, 2013

In This Issue

Last Week in Review: Weak economic news continues here at home and abroad, but is that good or bad news for home loan rates?

Forecast for the Week: Look for important reports on inflation, housing, manufacturing, and the labor market.

View: Want to know the key to being remarkable? Be sure to read the tips below.

Last Week in Review

You’re riding high in April and shot down in May.” The lyrics from the old Sinatra tune “That’s Life” haven’t applied to the economy this year, as it has limped along in April. Read on for the latest news, and how home loan rates were impacted.

apr29-existing-home-salesIn housing news, New Home Sales for March met expectations, coming in at 417,000. However, Existing Home Sales were down 0.6 percent and below expectations and February’s numbers were revised lower to 4.95 million units from 4.98 million units. There has not been much of an improvement in the Existing Home Sales numbers of late, but on the bright side they are higher than the 4.48 million mark from March 2012.

Gross Domestic Product (the broadest measure of economic activity in the U.S.) rose by 2.5 percent in the first quarter of 2013. However, this number was below the 2.8 percent to 3.2 percent that was expected. While the report showed that consumer spending rose at its fastest pace in two years and that businesses ramped up their inventories, overall this is not a great number. However, it is just the first of three readings and revisions will most likely be forthcoming. Also of note, March orders for Durable Goods (which are products that last for an extended period of time) also came in below expectations.

What does this mean for home loan rates? Bonds have benefited from the string of weak economic reports here at home, as investors typically move their money into safer investments like Bonds during weak economic times. This includes, Mortgage Bonds, to which home loan rates are tied. Bonds and home loan rates have also benefited from weak economic news overseas, as investors there continue to see our Bonds as a safe haven for their money. In addition, if inflation remains in check and economic data remains weak, this gives the Fed cover to continue its Bond purchase program known as Quantitative Easing–which should also benefit Bonds and home loan rates as a result.

The bottom line is that now is a great time to consider a home purchase or refinance, as home loan rates remain near historic lows. Let me know if I can answer any questions at all for you or your clients.

Forecast for the Week

The economic calendar will be busy all week. Plus the Fed meets.

  • The week begins on Monday with Personal Consumption and Expenditures, the Fed’s favorite measure of inflation, as well as Personal Income and Personal Spending.
  • In housing news, Pending Home Sales will also be released Monday, followed by Tuesday’s Case-Shiller Home Price Index.
  • We’ll get a sense of how the consumer is feeling with Tuesday’s Consumer Confidence reading for April.
    Several key manufacturing reports will be released, beginning on Tuesday with the Chicago PMI followed by Wednesday’s ISM Index.
  • Weekly Initial Jobless Claims will be reported on Thursday. Last week, jobless claims fell to 339,000 after averaging 362,000 in the previous four weeks.
  • On Friday, we end the week with the often market-moving Jobs Report for April, which includes Non-Farm Payrolls and the Unemployment Rate. ISM Services Index will also be reported.

In addition, the Fed’s regularly scheduled two-day meeting of the Federal Open Market Committee begins on Tuesday, with their Policy Statement scheduled for 2:15 p.m. ET on Wednesday.

Remember: Weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bonds and home loan rates improve, while strong economic news normally has the opposite result. The chart below shows Mortgage Backed Securities (MBS), which are the type of Bond that home loan rates are based on.

When you see these Bond prices moving higher, it means home loan rates are improving – and when they are moving lower, home loan rates are getting worse.

To go one step further – a red “candle” means that MBS worsened during the day, while a green “candle” means MBS improved during the day. Depending on how dramatic the changes were on any given day, this can cause rate changes throughout the day, as well as on the rate sheets we start with each morning.

As you can see in the chart below, Bonds and home loan rates continue to remain near historic best levels. I’ll be watching their movement closely.

apr29-bonds-chart

The Mortgage Market Guide View…

6 Keys to Being Remarkable

“The key to success in any field is, to a large extent, a matter of practicing a specific task for a total of around 10,000 hours.”
Malcolm Gladwell, Outliers, 2011

“Strenuous individual application is the price paid for distinction; excellence of any sort is placed beyond the reach of indolence.”
Samuel Smiles, Self-Help, 1859

“We are what we repeatedly do. Excellence, then, is not an act, but a habit.”
Aristotle, 345 BC

The myth that people are born talented is rapidly dispelling. The scientific community is at last catching up with what even Aristotle knew; the difference between success and non-success, outstanding skill and mediocrity, is a matter of dedication and time rather than innate ability. But can the way you practice make a difference? Yes, says Tony Schwartz, author of The Way We’re Working Isn’t Working, who offers six principles for becoming really good at anything:

  1. Pursue your passion. Passion will keep you motivated better than anything. If you can’t be passionate, find something else or you may burn out.
  2. Hard work first. Most experts–and experts who study experts–say that practicing first thing in the morning when you have the most energy is best.
  3. Practice intensely, but not too long. Working without interruption for short periods of no longer than 90 minutes with short breaks–and not longer than 4.5 hours each day–seems to be the norm for top performers.
  4. Get feedback in small doses. Too much advice too frequently can impede learning and make you gun shy.
  5. Refresh regularly. All work and no play… stinks. And it won’t help you in the long run. Plus, if it’s breakthroughs you want, rest is the best thing for activating your creative, right-hemisphere.
  6. Ritualize practice. Time-blocking your practice ensures you don’t have to expend any energy thinking about when you’ll work.

Please feel free to pass these tips along to any clients and colleagues who may benefit!

economic-carlendar-apr29

The material contained in this newsletter is provided by a third party to real estate, financial services and other professionals only for their use and the use of their clients. The material provided is for informational and educational purposes only and should not be construed as investment and/or mortgage advice. Although the material is deemed to be accurate and reliable, we do not make any representations as to its accuracy or completeness and as a result, there is no guarantee it is without errors.

As your mortgage professional, I am sending you the MMG WEEKLY because I am committed to keeping you updated on the economic events that impact interest rates and how they may affect you.

In the unlikely event that you no longer wish to receive these valuable market updates, please email me at don @ donparsons.com.

If you prefer to send your removal request by mail the address is:

Don Parsons
20250 Acacia Street, Suite 120
Newport Beach, CA 92660