Freddie Mac’s chief economist notes, “…all signs continue to point to a solid recovery in home sales activity heading into the summer as prospective buyers jump back into the market.”
In fact, the Mortgage Bankers Association reported purchase applications rose for the seventh week in a row, spiking 18% over last year, citing “pent-up demand from home buyers returning to the market.”
Realtor.com’s chief economist chimes in: “We’re seeing more home buyers in the market than we did this time last year.” She adds: “It’s shaping up to be a hotter-than-expected summer in the housing market.”
REVIEW OF LAST WEEK
NICE JOBS… A stunning, totally unexpected May jobs report did a nice job boosting stocks, as investors saw the start of economic recovery and scurried to make sure they didn’t miss out on the bargains available.
After economists predicted the LOSS of another 7.5 million jobs in May, everyone was blown away by the GAIN (!!!) of 2.5 million Nonfarm Payrolls. And instead of rising to a forecast 19.0%, the May Unemployment Rate fell to 13.3%.
Some said full recovery is still a long way off but admitted it’s begun. Weekly jobless claims are down nine weeks straight, while ISM Manufacturing and Non-Manufacturing indexes both rose.
The week ended with the Dow UP 6.8%, to 27,111; the S&P 500 UP 4.9%, to 3,194; and the Nasdaq UP 3.4%, to 9,814.
Bonds retreated on the signs of economic recovery. The UMBS 3.5% ended down 0.14, to $105.36. In Freddie Mac’s weekly Primary Mortgage Market Survey, the national average 30-year fixed mortgage rate barely edged up. Remember, mortgage rates can be extremely volatile, so check with your mortgage professional for up-to-the-minute information.
DID YOU KNOW?… Open houses have been on pause, but a new survey by the National Association of Realtors found 65% of those who attended an open house in the past year would do so now without hesitation.
THIS WEEK’S FORECAST
INFLATION MUTE, BUT WHAT WILL THE FED SAY?… The CPI (Consumer Price Index) and the wholesale PPI (Producer Price Index) should show inflation stays quiet. Though no rate hike is expected, all ears will be listening to the Fed’s take on the economy after it meets Wednesday for the latest FOMC Rate Decision.
NOTE: Weaker economic data tends to send bond prices up and interest rates down, while positive data points to lower bond prices and higher loan rates.