Weekly Update

Very weak 1st Quarter GDP results pushed mortgage rates to their lowest levels in a year. While this is certainly bad news for the economy, it does help mortgage bond prices improve, which causes a decline in mortgage rates.

Good news from last week includes New Home Sales for May jumped nearly 19 percent to an annual rate of 504,000, well above expectations. Existing Home Sales for May were also up 5 percent, reaching their highest level in over 2 years.

Bottom Line for Mortgages:

Bad economic news typically hurts stocks in favor of bonds, to which mortgage rates are tied. With the 1st Quarter GDP report showing a nearly 3 percent drop in overall economic activity, mortgage rates are at historic lows as we begin the week.

Interesting Article:
Research from the National Association of Realtors about student loan debt and how it may be holding back millennials from buying houses. 

 

“Student loan debt is a growing concern for REALTORS®, because of its impact on household formation. What is NAR doing to address the issue of growing student debt? NAR’s 2014 President, Steve Brown explains in his latest video.

The 49 percent of Americans who assess that having too much debt from college or student loans is a huge obstacle to home ownership is from National Association of REALTORS®, Housing Pulse Survey, July 2013.

The 29 percent of NAR members who cited their most recent buyer was a first-time home buyer is from the National Association of REALTORS®,REALTORS® Confidence Index. The latest figure from May 2014 is 27 percent.

The 50 percent of home buyers in 2010 who were first-time buyers is historical data from the National Association of REALTORS®, Profile of Home Buyers and Sellers.”

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