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Market UpdateHeadline News

Housing Market Index – Home builders are continuing to look upon the current housing market favorably, giving it a score of 57. Although this is one point lower than December’s revised score, it’s the seventh straight month with a score above the 50th percentile. Present sales lead the way with a score of 62, however, traffic of potential buyers in new homes were weak at 44. The future sales outlook remains strong, coming in at 60 despite a four-point drop.

MBA Purchase Applications – Purchase applications were down 3.0% week over week. However, the refinance index leaped, and went up 22.0% due to declining mortgage interest rates. Meanwhile, overall applications are up 3.0% over this time last year.

Housing Starts – Housing starts were up 4.4% in December, coming in at 1.089 million. The gains are based on strength in the single-family component. This is up 5.3% from this time a year ago. Meanwhile, housing permits were down 1.9% on the month to 1.032 million. Single-family permits were up 4.5% while multi-family permits were down 11.8%.

Jobless Claims – Initial claims fell by 10,000 this week to 307,000. The four-week average is 306,500, up 6,500 from the previous week. Continuing claims for the week of January 10 were up 15,000 to 2.443 million. This brought the four-week average up 9,000 to 2.427 million.

FHFA House Price Index – Home prices for November were up 0.8% month-to-month and 5.3% on the year. Analysts are taking this as sign that the housing market is improving, building on October’s 4.4% gain.

Existing Home Sales – Existing home sales rose 2.4% in December to an annual sales rate of 5.04 million. Available homes went from 2.08 million to 1.85 million, pushing supply in the market down to 4.4 months. Single-family homes lead in the gains with a 3.5% increase in sales.

Mortgage News

Fixed-rate mortgages were down this week, while adjustable rates were down or flat. Fixed-rate mortgages are very low at the moment.

30-year fixed-rate mortgages (FRMs) averaged 3.63% with an average 0.7 point for the week ending January 22, 2015, down from last week when they averaged 3.66%. A year ago at this time, 30-year FRMs averaged 4.39%.

15-year FRMs this week averaged 2.93% with an average 0.6 point, down from last week when they averaged 2.98%. A year ago at this time,15-year FRMs averaged 3.44%.

5-year Treasury-indexed hybrid adjustable-rate mortgages (ARMs) averaged 2.83% this week with an average 0.4 point, down from last week when they averaged 2.90%. A year ago, 5-year ARMs averaged 3.15%.

1-year Treasury-indexed ARMs averaged 2.37% this week with an average 0.4 point, unchanged from last week. At this time last year,1-year ARMs averaged 2.54%.

Equity Markets

The markets had their first weekly gains in a month. The Dow Jones Industrial Average fell 141.38 points on Friday to close at 17,672.60, still gaining 0.9% week-to-week. Despite losing 11.33 points on Friday, the S&P 500 was up 1.6% on the week, finishing at 2,051.82. The NASDAQ was up 7.48 points on Friday, closing at 4,757.88, up 2.7% on the week.

The Week Ahead

Tuesday, January 27

Durable Goods Orders (8:30 a.m. ET) – Durable goods orders are based on the new orders placed with domestic manufacturers for factory hard goods.

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.

New Home Sales (10:00 a.m. ET) – New home sales measure the number of newly constructed homes with a committed sale during the month. The level of new home sales indicates housing market trends, and in turn, economic momentum and consumer purchases of furniture and appliances.

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 consumers’ perceptions of current business and employment conditions, as well as their expectations for six months when considering business conditions, employment and income.

Wednesday, January 28

MBA Purchase Applications (7:00 a.m. ET) – The purchase applications index measures applications at mortgage lenders. This is a leading indicator for single-family home sales and housing construction.

Thursday, January 29

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.

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.

Friday, January 30

GDP (8:30 a.m. ET) – This measures the monetary value of all final goods and services produced within the U.S. This report is released on a quarterly basis.

Consumer Sentiment (9:55 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.

Visit the Quicken Loans Zing Blog for updated information on important economic releases that affect your wallet.

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