On the docket this week, we have some housing numbers and the all-too-important GDP data leading the way. Let’s get right into it.
Existing Home Sales: It was a really bad month for sales of existing homes in February. Sales fell 7.1% to a seasonally-adjusted annual rate of 5.080 million. The year-on-year growth rate is still at 2.2%, but this number was at 11.0% in January. Single-family homes saw their sales decrease 7.2% to 4.510 million on an annual basis. Condos are down 6.6% to 570,000. There are sales decreases in every region. The median sales price was down 1.4% to $210,800. This is still 4.4% higher than it was at this time last year. Supply in the market was up to 4.4 months from 4.0 months. While these numbers are very negative, it’s important to note that these monthly numbers tend to fluctuate quite a bit. We’ll have to see where it goes from here.
FHFA House Price Index: Home prices were up 0.5% for the month of January. This is up 6.0% from the same time last year and represents one of the strongest readings for home price appreciation in the last couple of years.
MBA Mortgage Applications: Mortgage applications fell by 3.3% this week as purchases were down 1.0% and refinances fell 5.0%. This happened despite the average rate for a 30-year-fixed mortgage falling to 3.93%, down one basis point.
New Home Sales: New home sales were up 2.0% to a seasonally-adjusted annual rate of 512,000. The median price for a home went up 6.2% in February to $301,400. Turning to regional data for the moment, sales in the West were up 39% after being down 33% in January. That region is up 10.2% on the year. The Midwest is up 1.9%. Meanwhile the Northeast and South have seen declines of 3.8% and 14.3% respectively for the year. Supply in the market remains unchanged at 5.6 months.
Durable Goods Orders: New orders were down 2.8% in February. When you take out transportation to eliminate the crazy swings of aircraft orders, it’s still down 1.0%. New orders are up 1.8% for the year, but down 0.5% when you take out transportation. Core capital goods are also down 1.8% for the month and 0.1% for the year. Total shipments were also down 0.9% and unfilled orders are down 0.4%. In a small positive, inventories are down 0.3%, but analysts would like to see them fall faster at a pace equal to shipments.
Jobless Claims: New claims came in 6,000 higher to 265,000. The four-week moving average was just 250 jobs higher at 259,750. Continuing claims fell 39,000 to 2.179 million. The four-week average for continuing claims fell 13,500, coming in at 2.210 million.
GDP: Real GDP came in with a 1.4% increase for the third estimate of the fourth quarter. This speed expectations for a 1.0% increase. Personal consumption expenditures were up 0.4% to 2.4% in this revision. Residential fixed investment was up 10.1% for the fourth quarter. There was a 2.1% decline on the nonresidential investment side, though. Final sales were also up 1.6%. On the negative side, net exports fell 0.14% and inventory was down 0.22%. Prices were up 0.9% for the month.
Mortgage rates were down across the board last week as traders started to adjust based on last week’s Fed announcement.
30-year fixed-rate mortgages (FRMs) averaged 3.71% with an average 0.5 point for the week ending March 24, 2016, down from last week when they averaged 3.73%. A year ago at this time, 30-year FRMs averaged 3.69%.
15-year FRMs this week averaged 2.96% with an average 0.4 point, down from last week when they averaged 2.99%. A year ago at this time, 15-year FRMs averaged 2.97%.
5-year Treasury-indexed hybrid adjustable rate mortgages (ARMs) averaged 2.89% this week with an average 0.5 point, down from last week when they averaged 2.93%. A year ago, 5-year ARMs averaged 2.92%.
Stocks were down during the holiday-shortened week, breaking a five-week streak of gains.
The Dow Jones Industrial Average was up 13.14 points Thursday to close at 17,515.73. Despite this, it was still down 0.49% for the week. The S&P 500 was down 0.77 points and fell 0.67% on the week to close at 2,035.94. The NASDAQ was down 0.46% for the week after being up 4.64 points Friday to close at 4,773.50.
The Week Ahead
Monday, March 28
International Trade in Goods (8:30 a.m. ET) – The Census Bureau’s Bureau of Economic Analysis has begun breaking out the goods from the rest of international trade numbers to get an idea of import and export estimates for GDP calculations.
Personal Income and Outlays (8:30 a.m. ET) – This measures all possible income sources as well as expenditures of the public.
Pending Home Sales Index (10:00 a.m. ET) – The National Association of Realtors developed the pending home sales index as a leading indicator of housing activity. Specifically, it’s a leading indicator of existing home sales, not new home sales.
Tuesday, March 29
S&P Case-Shiller HPI (9:00 a.m. ET) – The S&P Case-Shiller home pricing index tracks monthly changes in the value of residential real estate in 20 metropolitan regions across the U.S.
Consumer Confidence (10:00 a.m. ET) – The Conference Board compiles a survey of consumer attitudes on the economy. The headline Consumer Confidence Index is based on consumer perceptions of current business and employment conditions, as well as their expectations when considering business conditions, employment and income.
Wednesday, March 30
MBA Mortgage Applications (7:00 a.m. ET) – The mortgage applications index measures applications to mortgage lenders. This is a leading indicator for single-family home sales and housing construction.
Thursday, March 31
Jobless Claims (8:30 a.m. ET) – New unemployment claims are compiled weekly to show the number of individuals who filed for unemployment insurance for the first time. An increasing trend suggests a deteriorating labor market. The four-week moving average of new claims smooths out weekly volatility.
Friday, April 1
Employment Situation (8:30 a.m. ET) – The employment situation report measures unemployment in the labor force as well as the sentiments of workers about the job market.
Consumer Sentiment (10:00 a.m. ET) – The University of Michigan’s Consumer Survey Center questions 500 households each month on their financial conditions and attitudes about the economy. Consumer sentiment is directly related to the strength of consumer spending.
ISM Manufacturing Index (10:00 a.m.) – This index measures the general direction of manufacturing within the U.S. The qualitative survey of purchasing managers looks at production, new orders, order backlogs, inventories and supplier deliveries, among other factors.
Looks like a lot of important economic analysis is happening next week. You know we’re your source for mortgage and economic information, but we’ve got so much more to offer. Subscribe to the Zing Blog and see all sorts of insightful tips and tricks for your home, money and life.
If so, subscribe now for tips on home, money, and life delivered straight to your inbox.