Shelter Six:  Wishing You and Yours a Safe and Happy Thanksgiving!

November 19, 2018 by · Leave a Comment 

1. There are signs that the global economy is beginning to slow down.  Last week, both Germany and Japan released 3rd Quarter results indicating weakening economies.

2. The end of the rate hikes may be near.  Some investors are now projecting around four more Fed rate hikes this year and next before rate policy turns neutral.

3. Double good news last week for October as Retail Sales came in stronger than expected and the Core CPI Inflation Index came in as expected.

4. According to, the Plymouth colonists and Wampanoag Indians shared a harvest feast in 1621 that we acknowledge today as the first Thanksgiving.

5. It was not until 1863 during the Civil War, however, that President Abraham Lincoln first proclaimed a national day of Thanksgiving to be held each November.

6. Thanksgiving this year comes on the earliest day possible, November 22.  All of us at Shelter Home Mortgage wish you and your family a safe and Happy Thanksgiving!

Rate Update

Concerns about global economic growth as well as uncertainty around Britain’s exit from the European Union were key factors influencing mortgage rates slightly lower last week.

This Week

Housing Starts will be released on Tuesday with Existing Home Sales and Durable Orders out on Wednesday.  Mortgage markets will be closed on Thursday and close early on Friday.

Shelter Six: Homeownership Rates Continue to Surge

November 12, 2018 by · Leave a Comment 

1. As expected, the Federal Reserve held off on raising short-term rates at last week’s policy meeting but left the door open for another rate hike in December.

2. October’s Producer Price Index came in a good bit higher than expected and was 2.9% higher than a year ago. Higher inflation is never good for rates.

3. Homeownership rates continue to surge evidenced by 1.5M more households formed in the 3rd Quarter compared to a year ago.

4. The pace of the number of new households formed is on track for the best year since 2004.

5. The 35 and under age group is leading the charge with a homeownership rate of 36.8% in the 3rd Quarter, the highest level in five years.

6. With a strong economy and the millennial generation hitting peak housing demand age, housing demand should be strong for years to come.


Rate Update

Reaction to the inflation data, the Fed meeting, and the midterm election results was minimal, and mortgage rates ended the week with little change.


This Week

The Consumer Price Index (CPI) will come out on Wednesday and Retail Sales on Thursday. The mortgage markets will be closed today in observance of Veterans Day.

Shelter Six:  The Economy Added 250K Jobs in October

November 5, 2018 by · Leave a Comment 

1. The strong economy just keeps rolling along as evidenced by Friday’s Employment Report, which showed the economy adding 250K jobs in October!

2. The U.S. has now averaged 211K new jobs per month over the past year, while Unemployment has dropped to only 3.7%, the lowest level since 1969.

3. Average Hourly Earnings are also finally rising and were 3.1% higher than a year ago, the largest annual rate of increase since 2009.

4. A real strong economy often leads to high inflation, but key inflation data released last week showed inflation holding steady right at the Fed’s stated target level of 2%.

5. Fed Chair Powell thinks that the country could be at a “unique” time in its history with a “remarkably positive outlook” and that he expects unemployment to remain below 4% and inflation around 2% through the end of 2020.

6. Goldman Sachs economists were also upbeat adding there is not much sign of recession in the next three years and giving only a 36% chance of recession during that time.

Rate Update

The strong employment report influenced rates higher last week.  Look for rates to stay above 5% or go higher unless there is surprisingly weak economic data, a big downturn in stocks, or an unexpected headline that implies big economic risks.

This Week

The ISM National Services Index is due out on Monday and the JOLTS report on Tuesday.  The Fed meets again on Thursday but no change in rates is expected.

Shelter Six:  GDP Remains Strong

October 29, 2018 by · Leave a Comment 

1. Gross Domestic Product (GDP), the broadest measure of economic growth, was up a solid 3.5% for the recently completed 3rd Quarter (3.3% expected).

2. GDP was also up a whopping 4.2% during the 2nd Quarter, making for the strongest back-to-back quarters for GDP since 2014.

3. Thursday’s highly anticipated European Central Bank meeting brought no major surprises or interest rate changes.

4.’s September Housing Report showed the highest rise in new listings since 2013 with Atlanta up 12% over last September.  Nationally, listings were up 8%.

5. Shelter’s new SmartTrac program is designed for Borrowers who have had a Bankruptcy or Short Sale more than one year ago or multiple mortgage late payments over the last year.

6. SmartTrac provides a financing option for these Borrowers while requiring only 20% down and a 620 credit score.

Rate Update

The outlook for global growth slowed last week leading investors to move money from stocks to bonds, which led to a drop in both the stock market and mortgage rates.

This Week

The Core PCE Price Index is due out on Monday, the ISM National Manufacturing Index on Thursday, and the highly anticipated Employment Report on Friday.

Shelter Six:  Home Purchases Predicted to Increase in 2019

October 22, 2018 by · Leave a Comment 

1. The Mortgage Bankers Association (MBA) is forecasting that the strong U.S. economy, combined with low unemployment and rising incomes, will lead to a boost in home buying in 2019.

2. The MBA predicted at its Annual Conference last week that 2019 residential purchase mortgage originations will grow 4.2% over 2018 reaching $1.2 Trillion.

3. The MBA also predicted that the Fed will increase short-term rates once more in December and then three times in 2019, and that mortgage rates will average 5.1% next year.

4. Last week’s most significant economic data was Retail Sales, which were much lower than anticipated in September and just .1% higher than in August.

5. Nationally, September Existing Home Sales were also disappointing falling 3.4% from August and 4% from last year while reaching their lowest level since November 2015.

6. September Housing Starts were also down 5% from August.

Rate Update

The major economic data released last week was generally weaker than expected, but its impact was minor, and mortgage rates ended the week slightly higher.

This Week

New Home Sales will be released on Monday with both Pending Home Sales and Durable Orders due out on Thursday.

Shelter Six:  Stock Market Down, Credit Scores Up

October 15, 2018 by · Leave a Comment 

1. The Dow Jones stock index plunged more than 1,000 points last week shaking up the financial markets but having only a minor impact on mortgage rates.

2. FICO consumer credit scores continue to surge hitting a record high of 704 last month.  Scores have slowly climbed each year since a low-point of 686 in 2009.

3. The main reason for increasing credit scores is that fewer people have truly awful scores that drag the average down.

4. Shelter’s new SmartFunds program is a fantastic solution for a retiree or someone who has significant financial assets but no current job or employment income.

5. The program requires the assets to have been seasoned for at least a year and sufficient to cover the loan amount and all monthly debt obligations for 5 years (minimum of $500K).

6. The SmartFunds program does not have a Debt Ratio requirement, requires only 10% down with no PMI, and at least a 680 credit score.

Rate Update

Last week’s weaker than expected CPI inflation data along with the stock market selloff led to mortgage rates moving slightly lower yet still near the highest level in eight years.

This Week

Retail Sales will be released on Monday, the minutes from the Sept 26 Fed Meeting and Housing Starts on Wednesday, and Existing Home Sales on Friday.

Shelter Six:  Red Hot Economic Data Pushes Mortgage Rates Higher

October 8, 2018 by · Leave a Comment 

The economy continues to fire on all cylinders, which is great news for the future real estate sales, but not so great news for mortgage rates.

Last Wednesday, the ISM National Services Index soared to 61.8, which is the highest level recorded since tracking began in 2008.

This was followed by Friday’s Employment Report, which showed solid improvements in the labor market.

The economy has now added an astounding average of 211K workers per month so far in 2018 compared to an already very strong 182K per month last year.

The Unemployment Rate has plummeted to only 3.7%, the lowest level since 1969.

Average hourly earnings are also on the rise and were 2.8% higher than a year ago.  All of last week’s data points to a very strong economy.

Rate Update

Since it raises the outlook for future inflation, last week’s stronger than expected economic data was bad news for mortgage rates, which reached their highest levels in seven years.

This Week

The mortgage markets are closed on Monday for Columbus Day.  The biggest economic releases this week will be the CPI and JOLTS reports, both due out on Thursday.

Shelter Six:  The Fed Bumps up Rates .25% but Inflation Remains Tame

October 1, 2018 by · Leave a Comment 

1. As expected, the Federal Reserve raised the Fed Funds Rate by .25% last week.  The next rate hike is expected in December.

2. The only surprise at the Fed’s post-meeting press conference was a favorable comment from Fed Chair Powell that Fed officials don’t see inflation spiking more than expected.

3. Following Powell’s comment and right on cue, Friday’s big inflation report came in exactly at the Fed’s stated target level of 2% higher than a year ago.

4. Consumer Confidence is also very strong hitting its highest reading since September 2000 thanks to a healthy labor market and a surging stock market.

5. August home prices were up 5.8% in Metro Atlanta from a year ago, slightly less than the 6% national pace, according to S&P Corelogic Case-Shiller Index.

6. Metro Atlanta home prices are now up 8.1% since the recession peak of 2007 and 78.8% since the low point in 2012.

Rate Update

Last week’s Fed meeting and inflation data were both favorable for mortgage rates leading to a drop in rates from the previous week’s highest point in seven years.

This Week

The ISM National Manufacturing Index will be released on Monday, the ISM National Services Index on Wednesday, and Employment figures on Friday.

Shelter Six:  Home Sales Flat but Inventory up Slightly

September 24, 2018 by · Leave a Comment 

1. After four straight months of declines, Existing Home Sales were flat in August.

2. Inventory was a little higher than a year ago though, marking the first year-over-year increase in about three years.

3. Inventory remained at a 4.3-month supply from July, which is still low considering a 6-month supply is considered healthy.

4. In August, Housing Starts rose a strong 9% from July, but most of the increase was due to multi-family units and Single-Family starts were up just 2% from July.

5. Builders point to rising land, material, and labor costs as obstacles to a faster pace of new construction.

6. Overall, the economy remains strong with record highs in the stock market, a solid labor market, faster wage increases, and strong consumer confidence.

Rate Update

A rally in the stock market drew assets away from bonds last week pushing yields higher and mortgage rates to the highest point in seven years.

This Week

The next Federal Reserve meeting will take place on Wednesday.  Investors expect a .25% increase in short-term rates.  New Home Sales will be out on Wednesday, Durable Orders on Thursday, and the Core PCE Price Index on Friday.

Shelter Six:  Condo Financing Easier Than Ever

September 17, 2018 by · Leave a Comment 

1. Inflation continues to be tame.  Last week’s Consumer Price Index figures came in lower than expected and were only 2.2% higher than a year ago.

2. After a hot spring and summer, Retail Sales cooled off in August coming in less than expected but July’s figures were revised higher by about the same amount as the shortfall.

3. Non-warrantable condo financing is now easier than ever with Shelter’s new SmartCondo program.

4. SmartCondo requires only 10% down with no PMI and allows credit scores down to 660, debt ratios up to 45%, and an interest-only feature.

5. The program allows up to 75% investor concentration, up to 50% commercial space, and up to 49% single-entity ownership.

6. SmartCondo’s pre-sale requirements also go down to as low as 30% of units sold or under contract.  When it comes to condo financing, be smart with SmartCondo!

Rate Update

Strong economic news domestically as well as no surprises from a key European Central Bank meeting contributed to mortgage rates pushing up slightly last week.

This Week

The NAHB Home Builder Confidence index will be released on Tuesday, Housing Starts on Wednesday, and Existing Home Sales on Thursday.

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