The Michigan Wolverines are two games away from the NCAA Men’s Basketball Championship. I know that seems random, but it was by far the coolest thing that happened this weekend for me personally, and I just needed to shout it out.
Looking at your tournament bracket just might be the distraction you need, because I don’t suggest looking at your stock portfolio. The market was down more than 5% across the board last week. Without further ado, let’s get into that and all the market-moving data below.
MBA Mortgage Applications
Applications were down 1.1% overall in the mortgage market last week. Refinance applications fell 5.0%, and a 1.0% rise in purchase applications wasn’t enough to make up the slack.
The average rate on a 30-year-fixed conforming mortgage fell by one basis point to 4.68%.
Existing Home Sales
Sales of existing homes rose 3.0% last month and are back in positive territory for the year, up 1.1% since February 2017. Overall existing home sales came in at a seasonally adjusted annualized rate of 5.540 million.
Single-family home sales are now up 1.8% on the year after rising 4.2% on the month to come in at 4.960 million. This helped offset continued softness in the condo market, where sales were down 6.5% on the month and have fallen 4.9% on the year. This market added just 544,000 sales to annual sales rates this month.
There was a rise in supply on the market, up 4.6% to 1.590 million. They sold as fast as they could make it to the market, though, as supply relative to sales remained stagnant at 3.4 months.
Median prices were up 0.4% to $241,000, making for a 5.9% annual increase. There were sales gains in the West and South, while the Midwest and Northeast fell off a bit.
Initial jobless claims were up 3,000 to 229,000 last week. Meanwhile, the four-week average was up 2,250 to come in at 223,750.
These numbers may actually be slightly higher because the report again notes that procedures for filing claims in Puerto Rico and the Virgin Islands haven’t gotten back to normal following the widespread power outages caused by this year’s hurricane season.
Continuing claims were down 57,000, settling at 1.828 million. The four-week average was down 11,750 to come in at about 1.889 million. Both of these represent lows not seen since the early ‘70s.
FHFA House Price Index
Home prices were up 0.8% in the month of January, according to the Federal Housing Finance Agency. Its risen 7.3% on the year, which is the highest annual increase in 3 ½ years.
Western and Mountain region states are dealing with speculation of a price bubble. Prices are up 10.0% in the Mountain region and 9.4% in the Pacific. That said, there’s broad strength in other regions, with the South Atlantic, New England and East North Central each up at least 7.0% annually.
Durable Goods Orders
New durable goods orders were up 3.1% in the month of February and have risen 8.9% on the year, in what comes as a very strong report. Many transportation is taken out, they’re still up 1.2% and 8.1% on the year. Finally, in the core capital goods category, orders are up 1.8% on the month and 8.0% on the year.
Shipments were up 0.9%, and that rose to 1.0% when you take out transportation. Unfilled orders increased 0.2%, while inventories were up 0.4%.
Orders for primary metals were up 2.7%, while fabrication orders were up 0.8% and machinery orders increased 1.6%. Civilian aircraft orders were up 25.5%, and motor vehicle orders were up 1.6% in February.
New Home Sales
New home sales came in just slightly below consensus expectations in February at 618,000 on a seasonally adjusted annualized basis. However, there were strong revisions in the right direction for the two months prior, so 39,000 new sales were counted in those months. Still, sales in February were only at 0.5% on the year.
Prices and supply both showed some gains, however. The median price of a new home was up 0.6% on the month and 9.7% on the year to $326,800. The supply of new homes on the market is up 2.0% to 305,000 units and has risen 16.0% on the year. Relative to sales, supply was up slightly to 5.9 months compared to 5.8 months in January.
Sales in the Northeast were up 19.4% to an annual rate of 37,000. Meanwhile, sales in the South were up 9.0% to 338,000. The West was down 17.6% on the month, but is still up 3.1% on the year at 164,000. The Midwest has seen an 8.1% drop in annual sales after falling 3.7% in February to 79,000.
The Federal Reserve increased-short term interest rates by 0.25% at the conclusion of their March meeting last week. The good news is that the mortgage markets priced this in and barely reacted.
If you’re in the market right now, there can be no doubt that mortgage rates are still generally trending upward. If you see a deal you like, don’t hesitate to lock your rate. It may or may not be available tomorrow.
The average rate on a 30-year-fixed rate mortgage was up a single basis point to 4.45% for 0.5 points in fees. The rate at this time last year was 4.23%.
Looking at shorter terms, the average rate on a 15-year-fixed mortgage was up one basis point to 3.91% with 0.5 points. At the same time a year ago, the average rate was 3.44%.
Finally, the average rate on a 5-year treasury-index adjustable rate mortgage (ARM) also rose exactly one basis point to 3.68% with 0.4 points. Last year, the average rate was 3.24%.
The markets continued to worry about the impact of a potential trade war over plans for new tariffs. This sent all of the major indexes plunging and the Dow Jones industrial average and S&P 500 both ended up near correction territory on the day.
The Dow finished the week down 5.67% at 23,533.20 after falling 424.69 points Friday. The S&P 500 finished the day at 2,588.26. This was down 55.43 points on the day and 5.95% on the week. Finally, the Nasdaq was down 174.01 points on the day to close at 6,992.67, down 6.54% on the week.
The Week Ahead
Tuesday, March 27
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 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 28
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.
Gross Domestic Product (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.
International Trade in Goods (8:30 a.m. ET) – The Bureau of Economic Analysis has begun breaking out the goods from the remaining international trade numbers to get an idea of import and export estimates for GDP calculations.
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.
Thursday, March 29
Jobless Claims (8:30 a.m. ET) – New unemployment claims are compiled weekly to show the number of individuals filing 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.
Personal Income and Outlays (8:30 AM ET) – This is a measurement of how much consumers are taking in as well as their corresponding spending. This also gives insight into how much is being saved.
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.
Friday, March 30
Markets and banks are closed in observance of Good Friday. Quicken Loans will remain open.
There’s some major economic data coming next week. In addition to being my birthday Wednesday, that’s also an important day because GDP numbers will give us an idea of how the economy is performing.
If the idea of looking at mortgage rates or economic data any longer on a Monday will put you in a haze, we absolutely get it. We have plenty more home, money and lifestyle articles we would love to share with you if you subscribe to the Zing Blog below. If you’re getting ready this week for a visit from a special bunny, we’ve got 10 easy DIY Easter egg ideas you and the kids can do at home. Writer Allison Saunders is pretty proud of the Easter egg puns in that article. If you like them, too, maybe we can egg her on by leaving our own egg puns in the comments. Have a great week!
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