The Lowest Mortgage Rates Ever to Start Off a New Year

During 2010, mortgage rates dropped to record low levels, before moving higher over the final two months of the year. The primary reason for the recent increase in mortgage rates has been stronger economic growth, and the reports released last week showed the growth continuing. The Chicago PMI Manufacturing Index jumped to the highest level since 1988, far exceeding the consensus forecast. Pending Home Sales, a leading indicator for the housing market, also beat the consensus with an increase of 4%. In addition, Weekly Jobless Claims (as shown in the graph below) also unexpectedly fell below 400k to the lowest level since July 2008.

This strong economic news is encouraging and, hopefully, will only get stronger throughout the year. Keep in mind, however, that good economic news means bad news for mortgage rates. Fortunately, last week, two strong Treasury auctions offset the positive economic news and mortgage rates ended the week nearly unchanged. Despite the recent surge in rates, mortgage rates will start 2011 at the lowest level to begin any year in decades. In fact, only the start of 2009 rivals 2011, and mortgage rates in all other previous years of our generation were at least .5% higher than level where they are starting off inĀ 2011!

January 7, 2011 by · Leave a Comment

About James

James A. Williamson is currently the Sr VP of Sales Development for Shelter Lending Services (formerly Fairfield Mortgage). James joined Shelter in 1994 and was the company's top Loan Officer in GA for 20 straight years helping over 2500 families finance their homes. James now oversees an incredible group of Loan Officers in Atlanta while further building Shelter's Atlanta business.

Leave a Comment