Feb 18, 2014 | Mortgage Rates
Last week’s economic news was dominated by the first address by the new Fed chairperson, Janet Yellen.
Tuesday’s news included the Jobs Openings report for December 2013, which matched November’s reading of 4.0 million jobs available.
This information was taken from a gauge of competition for available jobs; in December, competition for job openings fell to its lowest level in five years.
Fed Chair Janet Yellen‘s First Address to House
Janet Yellen addressed the House Financial Services Committee for the first time on Tuesday as Chair of the Federal Reserve.
Ms. Yellen indicated that she expected “a great deal of continuity” in terms of Federal Open Market Committee (FOMC) monetary policy direction, and noted that markets should expect the FOMC to continue its support of low interest rates.
Chairman Yellen emphasized that the FOMC’s current tapering of its quantitative easing program was expected to continue, but is not on a pre-determined course.
If economic conditions change, the Fed’s monetary policy would be adjusted according to such developments.
Mortgage Rates Mixed According To Freddie Mac
According to Freddie Mac’s weekly Primary Mortgage Market Survey (PMMS), the average rate for a 30-year fixed rate mortgage rose to 4.28 percent from the prior week’s 4.23 percent.
The average rate for 15-year fixed rate mortgage mortgages was unchanged at 3.33 percent. The average rate for a 5/1 adjustable rate mortgage dropped from 3.08 percent to 3.05 percent.
Discount points for each category were unchanged at 0.70 percent for fixed rate mortgages and 0.50 percent for 5/1 adjustable rate mortgages.
In other news, Weekly Jobless Claims were higher last week at 339,000 against a forecast of 330,000 new jobless claims and the prior week’s reading of 331,000 new jobless claims.
Analysts cited bad weather and the possibility of slower economic growth as factors, but said that it was too soon to tell if economic growth is slowing down.
The University of Michigan’s Consumer Sentiment Index beat expectations with a reading of 81.2 against expectations for a reading of 80.0. February’s reading was unchanged from January.
What‘s Coming Up
This week’s economic news includes the NAHB Home Builder’s Housing Market Index on Tuesday. Wednesday’s events include Housing Starts and the minutes from January’s FOMC meeting.
In addition to Freddie Mac’s PMMS, Thursday’s scheduled reports include Weekly Jobless Claims, the Consumer Price Index (CPI) and Core CPI. Leading Economic Indicators (LEI) for January will also be released.
The National Association of REALTORS® will release data for existing home sales in January on Friday.
Feb 13, 2014 | Home Seller Tips
When we are going through a difficult and stressful time, our bodies naturally react to the situation. This “fight or flight” reaction to stress makes us more alert and ready to avoid danger, so it is helpful in the moment.
However, if you are in a constant state of stress on an ongoing basis, this can be very damaging to your health and can increase the risk of diseases such as heart disease, depression and other problems.
Chronic stress can also result in insomnia, headaches, upset stomach, elevated blood pressure, chest pain and much more – as well as emotional issues such as panic attacks, anxiety and worry.
This is why learning to manage your stress is crucial to your health. Many people try to manage their stress by overindulging in unhealthy substances, such as tobacco, drugs and alcohol.
However, by managing stress in this way you are actually making the problem worse because you are contributing to the stress on your body.
So what are some of the healthy ways that you can manage stress?
Express Your Feelings
A lot of stress comes from being angry or upset about a situation, but keeping your thoughts and feelings inside. You can relieve that stress by sharing your feelings and expressing how you feel.
Take Time To Relax
No matter how busy and chaotic things might be, take time for yourself to recharge and relax. Even if it’s only 20-30 minutes per day, having a bath, reading a book or going for a walk – it will really help to keep you calm.
Get Some Exercise
The act of exercising is a great stress reliever because it encourages your brain to produce feel-good chemicals such as endorphins. Also, your body will be better able to fight stress when it is in good shape.
Make Sure You Get Sleep
When there are a lot of demands on you, it can be tempting to want to skip sleep so that you can get more things done. However, when you are sleep deprived you will actually be much less effective and you won’t be able to handle stressful situations as well. Make sure that you go to bed at a reasonable time and get the sleep you need.
Speak To A Friend
Having a close friend who you can discuss your issues with can be a huge help when you are feeling stressed. Even if they can’t solve anything, it is simply helpful to have someone who listens, cares about how you are feeling and offers some encouraging words.
Managing your stress is crucial to your health, so make sure that you keep these tips in mind when things start to get overwhelming.
Feb 12, 2014 | Homebuyer Tips
Buying your first home is a major milestone in your life, similar to graduating high school or moving out of your parent’s house.
When you buy a property, you are making a long-term investment decision in your future and potentially taking the first step toward your future financial security.
However, buying a house before you are ready can actually be a negative move that puts a cramp in your plans.
It is important to assess where you are in life, so that you know whether or not it’s the right time to buy a house.
Some people buy their first home at 21, others at 30 and some might continue to rent for the rest of their lives – the decision depends on personal circumstances. But how can you determine for yourself whether you are ready?
You Have All Of Your Finances In Order
Is your credit score looking healthy? Have you paid off your credit card debt, student loans or personal loans?
If not, it is important to clean up your finances and pay down your debts before you start looking for a home, or you will be adding a mortgage on top of the debt before you are able to handle everything.
You Have Enough Savings For A Down Payment
Just because you can buy a home for as little as 3.5% down payment, doesn’t mean that you should. You will have your dream home, but your mortgage payments will be so high that you won’t have any money left over for repairs or improvements.
Also, you will end up paying thousands of dollars more in interest over the length of the loan. The bigger down payment you can save, creating equity in your home, the better.
You Are Earning Enough To Comfortably Afford The Mortgage Payment
Financial experts recommend that you never take a monthly payment that is more than 25% percent of your take home pay – including taxes and insurance.
Stretching yourself thinner will leave you little room for error and if your income drops for any reason – you will quickly find yourself in hot water.
You Are Happy To Settle In One Place
Could you see yourself settling in this location for the long term, or are you still considering moving elsewhere in the country or living abroad?
Buying a home is a long-term investment, so if you think that you might possibly move somewhere else in the next five years, you might want to think twice about buying a home and rent instead.
These are just a few of the signs that you are ready to purchase your first property. For more information, contact your trusted real estate professional.
Feb 11, 2014 | Home Selling Tips
Let’s face it, selling your home can be an emotionally difficult process – especially if you have lived there for a long time. When you make a house your home, it holds many of your memories and it becomes a part of your identity.
How can you sell the house in which your child took their first steps, where you held many dinner parties and where your family celebrated so many birthdays and holidays together?
You will go through a period of transition when moving house, which can be mentally and emotionally tiring.
It might be hard to sell your home, but time marches on and eventually it is time to move to a different location or simply downsize or up-size to suit your changing family situation.
The problem with being too emotionally attached to your home is that it makes it difficult to sell. When you have a sentimental attachment to your home you will estimate its value as higher than it really is and you will have trouble accepting counter offers.
Which could mean that your home is on the market for a long time when it could possibly have been sold for a reasonable price.
Here are some tips for emotionally detaching from your home so that it is easier to sell:
Remove Your Personal Items
Taking any of your personal items out of the house will make it a lot easier to sell, because the buyer will be able to imagine a blank slate filled with their items instead. Also, it will make the process easier on you if you can remove your family photos, keepsakes and personal items – because it will make the house feel less like yours.
Think About Your New Home
Whether or not you have already bought your next property, it’s time to start thinking about it as your new home. It will take some time, but you can transfer that emotional connection to the new place where you will live.
Start to focus on all of the things that you are looking forward to about living in your new home.
Preserve A Record Of Your Old Home
Take photos and even make a video tour of your old home before you move – so that you can always remember where you used to live.
Get An Outside Opinion
Ask your real estate agent or a professional home stager to take a look at your home with unbiased eyes to let you know what you should change to help it sell faster.
They might tell you to eliminate the jungle wallpaper in your son’s bedroom that you love – but they are probably correct in a way that you can’t see because your emotions cloud your judgement.
With these tips, you should be able to emotionally detach from your old home, so that it is easier to sell. For more information contact your real estate professional.
Feb 10, 2014 | Mortgage Rates
Residential Construction Spending Up
Last week’s mortgage and housing-related reports began with Construction Spending for December, with a reading of 0.10 percent or a seasonally adjusted $930.5 billion. December’s reading fell short of an expected increase of 0.40 percent.
Spending for private sector projects rose by 1.00 percent; of this amount, residential construction spending increased by 2.60 percent and private sector spending for non-residential construction fell by -0.70 percent.
Although construction spending posted a fractional gain, the good news is that construction spending is currently dominated by residential construction and that due to inclement winter weather, any gain in construction spending during December could be considered positive.
Jobs and Unemployment Data Mixed
Employment related reports dominated the week’s economic reports. The ADP employment report for January indicated that only 175,000 new private sector jobs were added for the lowest reading in five months.
December saw 227,000 new jobs. Severe weather conditions were the cause of lower than expected jobs growth. Month-to-month job reports can be unpredictable, but quarterly results provided positive information as the three month period ended in January 2014 saw average monthly job growth of 230,000 jobs as compared to an average reading of 220,000 jobs added during the same period a year ago.
New Jobless Claims came in at 331,000, significantly less than the prior week’s reading of 351,000 new jobless claims, and also lower than the forecasted reading of 337,000 new jobless claims. Analysts said that these readings supported gradual improvement in the economy.
The Bureau of Labor Statistics (BLS) released its Non-Farm Payrolls report for January, which indicated that 113,000 new jobs were added during the first month of 2014.
This reading was better than December’s reported 75,000 jobs added, and suggested to economists that bad weather was not the underlying cause of the dip in jobs growth. Healthcare and government sectors cut jobs in January.
With lower job growth, a higher unemployment rate would seem likely, but the national unemployment rate dropped to 6.60 percent from last week’s reading of 6.70 percent.
The Federal Reserve’s FOMC Committee has established a benchmark reading of 6.50 percent as one of the economic indicators it uses in decisions concerning federal stimulus programs.
Readings for labor and unemployment are important for the overall economy and housing markets; consumers worried about jobs that they might lose or jobs they cannot find likely won’t be buying homes in the near term.
Mortgage Rates Drop
According to last week’s Freddie Mac’s Primary Mortgage Market Survey, average mortgage rates dropped across the board. The reported rate for a 30-year fixed rate mortgage was 3.23 percent, down from the prior week’s 3.32 percent. Discount points were unchanged at 0.70 percent.
The rate for a 15-year fixed rate mortgage fell by seven basis points to 3.33 percent. Discount points ticked upward from 0.60 to 0.70 percent. The rate for a 5/1 adjustable rate mortgage fell by four basis points to 3.08 percent with discount points unchanged.
What‘s Coming Up This Week
This week’s scheduled economic news includes Weekly Jobless claims, Freddie Mac’s report on average mortgage rates, along with retail sales and retail sales except automotive sales.
The University of Michigan Consumer Sentiment report will be released Friday.
