Ellie Mae released its Origination Insight Report for July this week showing that the percentage of closed purchase loans held steady at 71%
Ellie Mae released its Origination Insight Report for July this week showing that the percentage of closed purchase loans held steady at 71% of total loans closed in July for the second straight month. Ellie Mae reports the average 30-year interest rate for all loans edged higher to 4.91% from 4.90% in June and a new Origination Insight Report high. “The purchase market remained solid in July and as we see inventories rise, we might begin to see a transition to a buyer’s market,” said Jonathan Corr, president and CEO of Ellie Mae. “The summer home buying season is still in full swing and while interest rates have risen, we expect to see a continued increase in purchase percentages.”
Consumer sentiment edged lower in early August and slipped to its lowest level since September 2017 concentrated in the bottom third of the income distribution. The Consumer Sentiment Index in August fell to 95.3, below the 97.8 expected and down from 97.9 in July. Consumers said that buying conditions for large households durable items fell to the lowest levels in four years. Home buying conditions were viewed less favorably in early August than any time in the past 10 years, with home prices judged less favorably than any time since 2006.
The pay rates between top chief executive officers and the average worker continued to widen in 2017. There was a 17% increase for the top guy with an average of $18.9 million a year compared with hardly a budge in wages for the average worker. The $18.9 million includes salaries, bonuses, restricted stock grants and other forms of compensation. The average worker pay grew by 0.2%.
Home price gains remained strong in June. CoreLogic reports that home prices, including distressed sales, rose 6.8% from June 2017 to June 2018
Home price gains remained strong in June. CoreLogic reports that home prices, including distressed sales, rose 6.8% from June 2017 to June 2018 and increased 0.7% month over month from May to June. Over the next year, gains are expected to slow as further increases in home prices and home loan rates could erode affordability and dampen sales and home-price growth. CoreLogic forecasts a 5.1% increase from June 2018 to June 2019 while month-over-month home prices are expected to be unchanged from June to July of this year.
Mortgage credit availability continued to increase in July for the third month in a row fueled by an increase in conventional credit supply. The Mortgage Bankers Association's Mortgage Credit Availability Index rose 1.7% in July after gains in both May and June. From a year ago, the index has increased 2.8%. The MCAI is calculated using several factors related to borrower eligibility (credit score, loan type, loan-to-value ratio, etc.).
A recent survey revealed that buying a home can be exhausting, confusing and complicated. Homes.com reports that in a survey of 2,000 Americans, 40% say that purchasing a home can be the most stressful event in modern life while another 44% said they felt nervous throughout the whole home buying process. In addition, about 33% of those surveyed admitted to shedding tears at some point during the process. “At the end of the day, buying a home is often the largest purchase the average American will experience in their lives,” said David Hoegerman, Homes.com senior manager of content.
The NFIB Small Business Optimism Index remains historically high as sales and profits maintained strength in June.
The NFIB Small Business Optimism Index remains historically high as sales and profits maintained strength in June. The Small Business Optimism Index hit 107.2 in June, down 0.6 from May, its sixth highest reading in survey history. "The first six months of the year have been very good to small business thanks to tax cuts, regulatory reform, and policies that help them grow," said NFIB President and CEO Juanita Duggan. Since December 2016, the Index has averaged lofty levels of 105.4, well above the 45-year average of 98 and just below the all-time high of 108.0 from July 1983. The biggest problem employers are now facing is finding qualified workers to fill positions.
Job openings remained at near all-time highs in May as the labor markets continues to gain strength. The Bureau of Labor Statistics reports that there was 6.6 million job openings on the last business day of May, just below the series high of 6.8 million in April, according to its JOLTS (Job Openings and Labor Turnover Survey) report. The report is closely monitored by the members of the U.S. Federal Reserve.
Mortgage delinquency rates have been edging lower as the economy and job markets strengthen. CoreLogic reports that the 30 days or more delinquency rate for April 2018 was 4.2%. In April 2017, 4.8% of mortgages were delinquent by at least 30 days or more including those in foreclosure. This represents a 0.6% decline in the overall delinquency rate compared with April 2017. CoreLogic says that delinquency rates are nearing historic lows, reflecting a long period of strict underwriting practices and improved economic conditions.
Mortgage rates edged lower over the past week and have now declined in three of the past four weeks.
Mortgage rates edged lower over the past week and have now declined in three of the past four weeks. After a sharp run-up in the early part of 2018, mortgage rates have stabilized over the last three months, with only a modest uptick since March. Freddie Mac reports that the 30-year fixed-rate mortgage fell five basis points in the latest week to 4.57% with an average 0.50 in points and fees.
Manufacturing activity in the Philadelphia region declined in June from May, though all the broad indicators remained positive. The June Philadelphia Manufacturing Index fell 15 points from May to 19.9 and below the 27 expected. The new orders index and general activity fell notably. Expectations for the next six months continued to moderate but remain positive overall. The survey went on to reveal that firms continued to report overall increases in employment.
The National Association of Manufacturers released the results of the Manufacturers' Outlook Survey for the second quarter of 2018. The survey showed that 95.1% of manufacturers have positive outlooks for their companies, an all-time in the survey’s 20-year history following the enactment of the Tax Cuts and Jobs Act. Within the report it showed all-time highs for projected employment growth and capital spending.
Housing sentiment continued to strengthen in May, but high home prices complicate consumer purchase confidence, reports Fannie Mae.
Housing sentiment continued to strengthen in May, but high home prices complicate consumer purchase confidence, reports Fannie Mae. Higher home prices are due in part to limited inventories of homes for sales on many markets across the nation. The Fannie Mae Home Purchase Sentiment Index (HPSI) rose 0.6 points in May to 92.3, reaching a new all-time survey high for the second consecutive month. The net share of respondents who reported that now is a good time to sell a home increased to 46% in May, and is now up 14 percentage points year over year. However, the net share of those surveyed said now is a good time to buy, decreased to 28%, showing little improvement in the past 12 months.
Not much action in the U.S. capital markets today as the investing world sits on their hands awaiting next week's Fed decision and monetary policy statement. Currently, there is a 90% chance of a 0.25% hike to short-term Fed Funds Rate. The Federal Open Market Committee meeting begins Tuesday and ends Wednesday at 2:00 p.m. ET with the rate announcement and statement. The Fed will also release economic projections while Fed Chair Powell will hold a press conference at 2:30 p.m. ET.