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Weekly Mortgage Update: 09/17/2018

September 18, 2017dillonBlog0

WEEKLY MORTGAGE WATCH – SEPTEMBER 17, 2017

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FIRST TEAM’S WEEKLY MORTGAGE WATCH (SEPTEMBER 17TH, 2017) THIS WEEK HIGHLIGHTS THE FOLLOWING UPDATES:

  • Both Retail Sales and Industrial Production headed lower last week, with mortgage rates holding steady in the face of mounting domestic uncertainty.
  • The hurricanes, political turmoil, and the potential for a new Fed Chair in February are creating questions for both economic growth and the Fed’s plans for next year.
  • While the 3rd quarter does appear to be softer than the previous one, August’s data did sport a little bit of inflation. This coupled with improvements in international economies could begin to create a floor for rates, even if the US economy sputters a bit.
  • This week, the Fed meets to discuss monetary policy. The market is expecting no change to the Fed’s interest rates, but we could see some more details or insights into when and how the Fed will begin to unwind its massive financial portfolio.
  • Should the Fed choose to continue to reinvest proceeds, then rates could trend just a bit further downward.
  • It’s worth beginning to pay a bit more attention to foreign economies. Some experts are expecting their gains to benefit our economy.

THE BEST PLACES TO LIVE AS A SENIOR

Looking for the best place to live out your golden years? The SeniorScore™ from SeniorAdvice.com is the first livability index designed for retirement years. The index factors in over 100 data points from multiple sources and separates them into four groups: health and safety, recreation and leisure, finances, and general quality of life. Rankings include cities and states with Virginia, Hawaii, Nebraska, Oklahoma, and Kansas currently topping the state list.

Weekly Mortgage Update: 09/11/2017′

September 11, 2017dillonBlog0

WEEKLY MORTGAGE WATCH – SEPTEMBER 10, 2017

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FIRST TEAM’S WEEKLY MORTGAGE WATCH (SEPTEMBER 10TH, 2017) THIS WEEK HIGHLIGHTS THE FOLLOWING UPDATES:

  • Hurricanes and wildfires certainly have devastating consequences for those impacted, and we don’t want to discount the tragedy or human stories that accompany these events.
  • From an economic standpoint, however, the national impact is historically limited. Of course, these aren’t normal times and these events are gigantic and widespread.
  • Because we don’t have a clear idea of what the impact will be, we are seeing some money flowing into the relative safety of treasuries and bonds. In many ways, more uncertainty is creeping into the market.
  • Will Washington be able to accomplish anything meaningful to improve the economy? Why does the economy continue to power ahead without generating any significant inflation? All of these unknowns appear to be helping hold rates low. We may have more of the same this week.
  • The wider spread the devastation is in the southeast, the more likely we are to see rates continue to be pulled slowly downward.
  • However, if we get that surprise jumps in the Producer and Consumer Prices Indices, then rates might move upward.

IS YOUR IDENTITY AND CREDIT AT RISK?

Last week, Equifax revealed that it was hacked, and up to 143 million people may have had their information stolen. The data theft snagged names, social security numbers, birth dates, driver’s license numbers, and addresses. The company has responded by launching a website that enables consumers to find if their data was part of the breach. Visit EquifaxSecurity2017.com to learn more, and also be sure to pull your free credit report at AnnualCreditReport.com.

Weekly Mortgage Update: 09/05/2017′

September 5, 2017dillonBlog0

WEEKLY MORTGAGE WATCH – SEPTEMBER 3, 2017

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FIRST TEAM’S WEEKLY MORTGAGE WATCH (SEPTEMBER 3RD, 2017) THIS WEEK HIGHLIGHTS THE FOLLOWING UPDATES:

  • Last week saw mortgage rates creep slightly downward, even with some strong economic news.
  • The ISM Manufacturing Index surged higher, and Consumer Confidence stepped upward again.
  • This was coupled with GDP being adjusted upward more than expected to a solid 3.0% for the 2nd quarter. However, other data and news helped pull rates downward.
  • The number of new jobs created in August fell short, and the two previous months were notched downward.
  • Inflation continues to be so negligible, that odds of the Fed raising rates again this year are sliding downward.
  • All of this comes against the backdrop of North Korea testing another nuclear weapon and concerns regarding the impact of Hurricane Harvey. Partially due to these events, investors shifted money into the relative safety of US Treasuries and bonds, even though the events may have limited economic impact.
  • This week is much lighter on the economic front, and with most of the critical monthly data behind us, rates are more than likely to drift about, in a very tight range, unless something dramatic happens.

PRESSURE FOR ALTERNATIVE CREDIT SCORING MOUNTS

America’s Homeowners Alliance, a coalition of 15 housing and finance associations, is ramping up the pressure on the Federal Housing Finance Agency (FHFA) to approve the use of alternative credit scoring models at Fannie Mae and Freddie Mac. The FHFA appears to be pushing out the date that the models could be implemented. The Alliance believes that implementing the alternative models could help stem the decline in the homeownership rate of some groups.

Weekly Mortgage Update: August 28th 2017′

August 28, 2017dillonBlog0

WEEKLY MORTGAGE WATCH – AUGUST 27, 2017

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FIRST TEAM’S WEEKLY MORTGAGE WATCH (AUGUST 27TH, 2017) THIS WEEK HIGHLIGHTS THE FOLLOWING UPDATES:

  • As the summer of 2017 heads into its final week, mortgage rates continue what has begun to feel like a long vigilant watch for either accelerating economic growth or increasing economic pressure.
  • As we wait, rates have drifted very slowly down from last November’s spike upward.
  • The week ended with the annual meeting of economic heavyweights in Jacksons Hole, WY. During some years, the words from central bank leaders have rocked markets. This year, we didn’t even get a fizzle.
  • No surprises were expected and none were delivered. Many of our trading partners are in the same boat.
  • We certainly shouldn’t complain about years of economic improvement, but the slow rate of growth is frustrating for those who would like to see their economies improving at a more rapid pace.
  • The week features many significant economic reports on employment, inflation, and manufacturing.
  • If all the big reports can generate better-than-expected results, then rates might move upward. But the tragic events in Texas and potential economic impact may help hold rates from rising very much.

CHANGING TASTES ARE FEATURING PAJAMA LOUNGES

The living room has long been the staple of the American home. According to many designers, builders, and agents, this often underused, formal room is moving upstairs. Reminiscent of the “retiring room” of old, these more casual rooms are designed for relaxed, family space. Often the bedrooms spill into a large open space that may include comfortable seating, televisions, and even kitchenettes. Some believe, these features are helping these homes sell quickly.

Weekly Mortgage Update: August 21st, 2017′

August 21, 2017dillonBlog0

WEEKLY MORTGAGE WATCH – AUGUST 21, 2017

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FIRST TEAM’S WEEKLY MORTGAGE WATCH (AUGUST 20TH, 2017) THIS WEEK HIGHLIGHTS THE FOLLOWING UPDATES:

  • Retail Sales data came in strong for July, with adjustments upward for both May and June. Industrial Production also posted a reasonable increase.
  • Weekly jobless claims posted another very low reading. However, even with what looks like decent economic data, mortgage rates remain almost unchanged. Some of this may have been due to the minutes from the latest meeting of the Federal Reserve.
  • The notes have led analysts to believe that we may not see the start of the trimming of the Fed’s balance sheet until perhaps 2018.
  • Without any threatening inflation concerns, we could even see an increase in the Fed funds rate with a very limited impact on other rates.
  • Additionally, recent political turmoil continues to diminish the chances that any business-friendly legislation will be accomplished soon.
  • Political drama may dominate the news again this week, and with limited economic data due, rates are likely to remain in a very tight range.
  • We’ll also be getting another round of insight into the housing market, and all indications are that we’re continuing with strong sales and increased prices.

REAL ESTATE AGENTS SELL HOMES FOR MORE THAN FSBOS

Saving money is a smart thing to do. If you do it yourself, you can often save money. Real estate agents are sometimes accused of overcharging for their services, but a new study shows that they are worth it. Analyzing 2016 and the first half of 2017 sales, the researchers from Collateral Analytics found that FSBO’s netted 6% less than agent sales. In many cases, the spread was even wider. Factoring in the cost of marketing a home, using an agent is the cheaper way to go.

Weekly Mortgage Update: 8/14/2017′

August 16, 2017dillonBlog0

WEEKLY MORTGAGE WATCH – AUGUST 13, 2017

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FIRST TEAM’S WEEKLY MORTGAGE WATCH (AUGUST 13TH, 2017) THIS WEEK HIGHLIGHTS THE FOLLOWING UPDATES:

  • While last week’s decline in interest rates down to 3.90% could have been attributed to the rising tensions in Korea, the real story is probably the continued lack of inflationary pressures.

    Economic data continues to point to a consumer-level inflation rate under the Fed’s target of 2.0%. While this certainly does give the Fed plenty of room to maneuver, it does highlight that the economy just can’t seem to get out of low gear.

  • The market seems to remain pessimistic about the probability of any efforts out of DC that could boost the economy.
  • If infrastructure or tax reform efforts begin to move in the coming weeks, we might actually see rates trending upward. If not, we may keep these low rates for some time.
  • This week is bit heavier on the economic data with both Retail Sales and Industrial Production due. If either, or moreover both, surprise the market with better than 0.5% increases, then rates could begin to notch upward.
  • Of course, if international tensions spike with any significantly concerning activities regarding military action in Korea, then that would also press rates upward.

HOUSING SHORTAGE? NOT IF YOU DON’T WANT TO MOVE

An interesting study from Realtor.com just discovered one of the potential reasons why housing inventory remains tight. It is rather simple – baby boomers are not moving. While they are hitting an age where historically the age group would be looking to relocate or downsize, a significant portion are deciding to “age in place,” in their current homes. Toss in that the tight market also constrains their potential choices, and until we have more homes built, this trend may persist.

 

Weekly Mortgage Update: 08/07/2017

August 8, 2017dillonBlog0

WEEKLY MORTGAGE WATCH – AUGUST 6, 2017

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FIRST TEAM’S WEEKLY MORTGAGE WATCH (AUGUST 6TH, 2017) THIS WEEK HIGHLIGHTS THE FOLLOWING UPDATES:

  • Mortgage rates seem to have shifted into neutral, as the economy continues to plod along in the same vein as it has for many years.
  • Last week, the monthly employment report revealed another plus-200K story of new jobs created. 
  • Balancing that was decreases in both the ISM indices. While both remain on the “expansive” side of the equation, neither services nor manufacturing are able to significantly accelerate. 
  • With domestic activity appearing constrained, we may get an economic boost from overseas. If some of our trading partners’ economies continue to grow, our exports should pick up. This would result in net increase to our GDP, and ultimately should help improve our economy.
  • Jobs and inflation will be highlighted in economic reports this week, and no significant change is expected.
  • While the improving labor market should be generating some wage-driven inflation, its impact has been negligible in this recovery. Of course, the lack of inflationary pressure, coupled with even modest economic growth, continues to give the Fed plenty of time to ponder each move.

FORGET THE SPOUSE; I’M BUYING FOR THE DOG!

A recent survey from Suntrust Mortgage explored factors that motivated millennials to purchase a home. Historically, marriage and children have been two of the largest factors, but that is changing. The number one reason, with 66% of respondents citing, was “more living space.” Only 25% cited marriage, while 19% cited birth of a child. Ahead of both those influences was 33% who cited needing a better space or a yard for their furry, four-legged friend.

Weekly Mortgage Update: 07/24/17 – 07/30/17

July 25, 2017dillonBlog0

WEEKLY MORTGAGE WATCH – JULY 23rd-30th, 2017

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FIRST TEAM’S WEEKLY MORTGAGE WATCH (JULY 23RD, 2017) THIS WEEK HIGHLIGHTS THE FOLLOWING UPDATES:

  • Mortgage rates managed to find some room to slip back downward last week.
  • With a light domestic economic calendar, markets looked overseas.
  • Only a few weeks ago, the European Central Bank was making pronouncements about the potential of beginning to tighten its policy. With such limited inflationary pressures, the ECB changed its mind.
  • Even with economic growth for years, inflation remains muted. This continues to give central banks plenty of time to ponder their next, major move.
  • The Fed meets next week amid a busy week of economic data. We’ll get our first look at the 2nd quarter’s GDP, and it’s expected to continue the multi-year trend of bouncing upward from the 1st quarter.
  • More than likely, the Fed will note that we continue to remain in a pattern of slow growth. As such, we may see some hints that the Fed’s pace of increasing rates is very flexible.
  • If the Fed does this, then mortgage rates are likely to continue a very slow downward drift. However, if GDP comes up short, along with weak Consumer Confidence numbers, then rates could drop quicker.

FOREIGN BUYERS SNATCHING UP PROPERTY

Recent analysis revealed that Between April 2016 and March 2017, foreign buyers and recent immigrants purchased $153 billion of residential property in the US. This represents a 49% increase from the previous year. Foreign buyers concentrated 49% of their purchases in three states: Florida, California, and Texas. Chinese purchases accounted for $31 billion in purchases, while Canadians picked up another $19 billion in purchases from their southern neighbor.

Weekly Mortgage Update: (06/19/2017)

June 19, 2017dillonBlog0

WEEKLY MORTGAGE WATCH – JUNE 18, 2017

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FIRST TEAM’S WEEKLY MORTGAGE WATCH (JUNE 18TH, 2017) THIS WEEK HIGHLIGHTS THE FOLLOWING UPDATES:

  • Even with a Fed rate hike last week, mortgage rates barely budged.
  • The Fed did announce plans to begin reducing its massive balance sheet, at some point later in the year. The plan is very gradual and should help the market slowly adjust to a less accommodative policy.
  • Overall, the economy seems to continue to remain in the same slow recovery mode that we’ve all grown accustomed too. As the 2nd quarter’s data trickles in, it appears we won’t have any large increase in overall economic activity.
  • Industrial Production flat-lined, with manufacturing pulling back. 
  • Once again, inflationary pressures cooled while consumer moods are becoming less enthusiastic. 
  • Retail Sales retreated 0.3%. This week is relatively light for economic data, but we will get more insight into the housing market. We are expecting new and existing sales to head in opposite directions. If both can move upward, then we might see a little upward movement in rates.
  • However, given last week’s somewhat weaker-than-expected data, mortgage rates may have a stronger tendency to slip downward.

DON’T FLIP OUT. IT JUST MIGHT BE YOUR TURN

Many of us watch the television shows on flipping homes, and dream of breathing new life into that rundown gem of a home. Of course, flipping really is only for those can flip dozens of homes, right? Wrong! According to research from ATTOM data solutions, a whopping 69% of flippers in the first quarter of this year were mom and pop operations that only flipped one home.

Weekly Mortgage Update: (06/12/2017)

June 12, 2017dillonBlog0

WEEKLY MORTGAGE WATCH – JUNE 11, 2017

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FIRST TEAM’S WEEKLY MORTGAGE WATCH (JUNE 11TH, 2017) THIS WEEK HIGHLIGHTS THE FOLLOWING UPDATES:

  • Mortgage rates found room to trend downward last week, as politics weighed heavily on financial markets.
  • Domestically, the drama surrounding all things Russia continued to decrease the odds of the new administration completing any real regulatory or tax reform program.
  • “Across the pond,” the UK’s snap election resulted in a hung parliament, which translates into more uncertainty for the start of the BREXIT negotiations.
  • All of this pushed even more money into US Treasuries and bonds.
  • This week is heavy with economic data and a Fed meeting. Markets have already “baked in” another rate increase, but analysts will be scouring everything released from the Fed.
  • The big question will be how likely the Fed is to raise rates again.
  • A more dovish outlook from the Fed could actually help pull rates downward, slightly. This could easily be reinforced if any of the big economic reports, including Retail Sales or Industrial Production, come at, or under, expectations.
  • If the Fed surprises the market with no change to its rates, then we could see rates falling even further.

SURVEY SAYS: NOW IS THE TIME TO SELL

According to the latest Home Purchase Sentiment Index from Fannie Mae, 32% of Americans believe that now is a good time to sell their home. This represents the highest level in the seven-year history of this index, and a jump of 6 points over last month. Conversely, and unsurprisingly, the survey saw an 8 point drop to 27% of Americans who believe that now is a good time to buy a home. Interesting, only 40% of respondents believe that home prices will go up.

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    Yorba Linda, CA 92886
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