Shelter Six:  Consumer Spending Boosts Economic Recovery

Consumer Spending continued to rebound for the third straight month in July, up 1.2% from June and 2.7% from a year ago.

Inflation, always a concern to mortgage rates, came in stronger than expected last week largely due to a jump in auto and apparel costs.

A Mortgage Bankers Association survey showed mortgage applications for new home purchases up 1% from a very strong June and 39% from a year ago.

Home prices were up 4.2% over the Second Quarter of the year, after increasing 7.7% over the First Quarter.  The Second Quarter National Median Price was $291,300.

Initial Jobless claims for the week ending August 8 decreased to below a million for the first time in five months, an encouraging sign for the labor market recovery.

The most popular ARM index, LIBOR, is being replaced this month by the Secured Overnight Financing Rate, or SOFR.

Rate Update

Mortgage rates pushed higher last week due to a new fee added by Fannie Mae and Freddie Mac’s regulator as well as inflation figures coming in stronger than expected.  30-year rates are now a little over 3% for the first time since early June.

This Week

It will be a very light week for economic data with Housing Starts to be released on Tuesday and Existing Home Sales on Friday.

August 17, 2020 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.

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