Weekly Rate Update

December 13, 2019

Mortgage Rates are Moving Up

Economy News

  • The Fed kept policy rates unchanged at this week’s FOMC meeting and also signaled that rates are unlikely to change in 2020 with moderate economic growth.

  • Consumer prices increased more than expected in November, mainly due to higher gas costs. Price increases drive inflation, which pressures mortgage rates higher.

  • Stocks continue to hit record highs as a phase one trade deal with China seems to be moving closer to completion. If not postponed, more tariffs take effect Dec 15th.

Housing News

  • Builders continue to move away from basements. A recent survey shows 60% of new single family homes in 2018 were built on slab foundations and 14% with a crawl space.

  • Sustainable features are the latest trend to attract buyers. Favorites include low-flow toilets and showerheads; multipane windows; and electric charging stations.

  • First-time buyers are on the rise, up from a year ago. FTBs comprised 39% of all single family home buyers and 55% of purchase mortgages in the 3rd quarter.

Published interest rates based off the following scenarios: Conventional, HomeReady; $380k loan amount, 80% LTV, 740+ Credit Score and rate lock good for 30 days. FHA; $380k loan amount, 96.5% LTV, 740+ Credit Score, and rate lock good for 30 days. VA; $380k loan amount, 100% LTV, 740+ Credit Score, and rate lock good for 30 days. High Balance Conforming; $561,200 Loan amount, 75% LTV, 740+ Credit Score and lock good for 30 days. Jumbo; $800,000, 75% LTV, 760+ Credit Score and rate lock good for 30 days.