Last week’s economic reports included readings from S&P Case-Shiller Home Price Indices, readings on new and pending home sales, and the University of Michigan’s Consumer Sentiment Index. Weekly reports on mortgage rates and jobless claims were also published.
S&P Case-Shiller Home Price Indices: Home Prices Rose Faster in November
The Case-Shiller National Home Price Index showed that November home prices grew by 9.50 percent on a seasonally-adjusted annual basis. October’s reading showed 8.40 percent home price growth; analysts expected a year-over-year pace of 8.80 percent for national home price growth.
Severe shortages of available homes coupled with high demand for homes continued to fuel rising home prices as builders faced rising materials costs. The covid pandemic added to home price growth, which is expected to slow as businesses and employers reopen and flight from congested urban areas slows.
The 20-City Home Price Index reported home price growth in 19 of 20 cities; Detroit, Michigan has not reported its data in recent months. Phoenix, Arizona, Seattle, Washington, and San Diego, California again held the top three places in the 20-City Index.
New Home Sales Rise in December
New homes sold at a seasonally-adjusted annual pace of 842,000 sales as compared to a sales pace of 829,000 homes sold in November. Pending home sales were lower in December with a -0.30 percent decline. Analysts forecasted a reading of -0.20 percent in pending sales based on November’s reading of -2.60 percent fewer pending home sales. Seasonal influences including winter weather and the holiday season typically cause home sales to fall during the winter months.
Mortgage Rates, Jobless Claims Lower
Freddie Mac reported lower fixed mortgage rates last week; the average rate for 30-year fixed-rate mortgages fell by four basis points to 2.73 percent. The average rate for 15-year fixed-rate mortgages fell one basis point to 2.20 percent. The average rate for 5/1 adjustable rate mortgages was unchanged at 2.80 percent. Discount points averaged 0.70 percent, 0.60 percent, and 0.30 percent respectively.
First-time jobless claims fell to 847,000 claims filed as compared to the prior week’s reading of 914,000 initial claims filed. Continuing jobless claims were also lower with 4.77 million claims filed. as compared to the previous week’s reading of 4.97 million claims filed.
The University of Michigan reported an index reading of 79.0 in January for its Consumer Sentiment Index. Analysts expected no change to December’s reading of 79.2. The continued spread of covid-19 and related economic concerns contributed to lower consumer sentiment.
This week’s scheduled economic readings include labor-sector reports on public and private obs growth and the national unemployment rate. Weekly reports on mortgage rates and jobless claims will also be released.Share
About the Author:Babak Moghaddam graduated from University of Southern California in 1985. He entered the mortgage industry as a compliance auditor at the Bank of New York in 1986 and completed his masters in Business Administration two years later. After seventeen years in the traditional mortgage banking world Babak finally transformed this vision into his own practice in 2002 when he formed Charter Pacific Lending Corp, a mortgage company that has provided over $900 Million in residential real estate loans throughout Southern California. Babak and his team do things a little differently than other mortgage providers. They work as financial advisors, because they have come to realize that a mortgage is a very powerful financial tool. And just like any other financial tool, it should be managed as part of the overall financial management plan to reach every home owner’s long and short-term financial goals much faster. You can contact Babak for a free consultation and strategy session at (800) 322-1217 X103.