What Home Buyers Need to Know for the Week of July 7, 2014
Last week we got mixed economic news affecting housing. Non-Farm Payrolls and the National Unemployment Rate suggest a strengthening our labor force; Pending Home Sales surpassed expectations in May, but Construction Spending only increased by 0.1 percent.
ADP Private Sector Jobs Report, which measures private-sector job growth, reported 281,000 new jobs in June as compared to a reading of 179,000 new private-sector jobs in May. The Bureau of Labor Statistics’ Non-Farm Payroll Report for June surpassed expectations of 215,000 jobs by adding 288,000 jobs against May’s reading of 224,000. The national unemployment rate fell to 6.10 percent, while the predictions remained at 6.30 percent.
The National Association of REALTORS® reported that Pending Home Sales in May rose by 6.10 percent over April’s reading and the largest monthly gain since April 2010, when homes sales spiked to 9.6 percent ahead of the expiration of a tax credit for first time home buyers. The Northeast showed the greatest increase of 8.80 percent and the West came in second at 7.60 percent; while the Midwest showed an increase of 6.30 percent, followed by the lowest gains coming from the South at 4.40 percent
Nationally home prices rose by 1.40 percent in May and 10 states posted new month-to-month highs, while year-over-year reading slipped from 10.00 percent in April to 8.80 percent in May. Nationally, home prices remain about 13.50 percent lower than their 2006 peak.
Freddie Mac’s weekly survey of average mortgage rates brought good news last week, as the rate for a 30-year fixed rate mortgage dropped by two basis points to 4.12 percent. The average rate for a 15-year fixed rate mortgage was unchanged at 3.22 percent, as was the average rate for a 5/1 adjustable rate mortgage was at 2.98 percent. Discount points were unchanged at 0.50 percent for a 30-year fixed rate mortgage and 15-year fixed rate mortgages. Discount rates rose from 0.30 to 0.40 percent for 5/1 adjustable rate mortgages.
What’s Ahead for the Week?