This Week in Real Estate: April 11, 2016


This Week in Real Estate interest rates hit a new low in 2016, which fuels continued momentum as we begin the second quarter. Below are a few highlights from the first week of April that influence our business:

* Mortgage Rates at New 2016 Lows. On Thursday Freddie Mac released the results of its Primary Mortgage Market Survey, showing mortgage rates declining from the previous week and reaching their lowest level since February of last year. “Mortgage rates this week registered the delayed impact of last week’s sharp drop in Treasury yields as the 30-year mortgage rate fell 12 basis points to 3.59 percent. This rate marks a new low for 2016 and matches last year’s low in February 2015. Low mortgage rates and a positive employment outlook should support a strong housing market in the second quarter of 2016,” said Sean Becketti, chief economist for Freddie Mac.
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* CoreLogic: Home Prices Nationwide Continue to Rise. Home prices nationwide, including distressed sales, increased year over year by 6.8% in February 2016 compared to February 2015 and increased month over month by 1.1% in February compared with January 2016, according to the most recent report from housing data services provider, CoreLogic. “Fixed-rate mortgage rates dropped more than one-quarter of a percentage point in the first three months of 2016, and job creation averaged 209,000 over the same period,” said Dr. Frank Nothaft, chief economist for CoreLogic. “These economic forces will sustain home purchases during the spring and support the 5.2% home price appreciation CoreLogic has projected for the next year,” added Nothaft. According to the report, two states topped the list for the biggest yearly price gains in February. Washington exceeded with 12.4% and Colorado at 10.5%. Not far behind are Oregon, at 9.3% and Nevada, at 8.6%. All are much stronger price gains than the national average of 6.8%.
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* Federal Open Market Committee March Meeting – Expect an April Freeze. PThe minutes from the March meeting of the Federal Reserve’s monetary policy setting committee, the Federal Open Market Committee (FOMC), provide details of the deliberations regarding assessments of the current state of the economy and the anticipated pace of future increases to the target range for federal funds rate. April is off the table, the funds rate will be frozen at the December level until at lease the June meeting. Early indications are that US economic conditions have largely recovered from the sharp asset price movements in the opening weeks of 2016, but the committee decided it would be prudent to wait for additional information to confirm this view. This caution was a decisive factor in the decision not to raise the funds rate at the March meeting. If economic growth, the labor market and inflation sustain recent gains in the interim months, the June FOMC meeting is a strong possibility for the next increase.
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Have a productive week!


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