Mortgage Rates Inch Higher - 1/15/21
- Consumer prices increased in December, but underlying inflation remained tame. Low inflation is good because rising inflation can pressure mortgage rates higher.
- President-elect Joe Biden released his plans for more fiscal stimulus when he takes office. The added stimulus is expected to help the economy but could pressure mortgage rates higher.
- Jobless claims surged last week, confirming a weakening in the labor market as virus counts rise and the pandemic disrupts operations at restaurants and other businesses.
- After setting more than a dozen record lows last year, rates started 2021 on an upward climb. Refinance applications rose 20% last week as borrowers tried to beat further increases.
- Only 16% of respondents to Fannie Mae’s December National Housing Survey feel that housing prices will fall in 2021. More than 50% felt it was a good time to buy or sell a home.
- According to a Wall Street Journal report, builders are building tens of thousands of homes to be used as rentals, believing rentals will stay in high demand as prices continue to rise.