mortgage update denver colorado

Average Home Price Jumps 11.3% from Last Year:

More good news about the housing market: Inventories are lower, prices are higher and the number of days a home is on the market has decreased.

According to the Existing Home Sales report that was just released, the median price paid for a previously occupied home rose 11.3 percent from a year earlier to $183,900.

Tight inventories have helped support home prices in recent months, which could help economic growth by making consumers more comfortable about their finances. The nation’s stock of existing homes for sale fell 3.3 percent last month to 2.32 million units. At the current pace of sales, inventories would be exhausted in 5.9 months, the lowest rate since March 2006, the National Association of Realtors said.

The median time previously owned homes spent on market was 70 days in September, down 30.7 percent from a year ago. Also helping prices – the share of distressed sales fell to 24 percent in September, down from 30 percent in the same month of 2011.

The low-hanging fruit has already been picked over the past year and now there are concerns that there may be a shortage of housing in some areas which has fueled buyer interest in acting sooner rather than later.

What Happened to Rates Last Week?

colorado mortgage rates

Mortgage backed securities (MBS) lost -60 basis points from last Friday to the prior Friday which caused 30 year fixed mortgage rates to move higher. We had our highest mortgage rates on Thursday and our lowest rates on Monday.

On the U.S. economic front, Retail Sales, Business Inventories, Housing Starts, Building Permits and Existing Home Sales were all better than expected which was positive for our economic growth, but negative for MBS and mortgage rates.

But what really pressured Mortgage Backed Securities (and therefore caused your rates to increase) was news about Spain. Moody’s was widely expected to downgrade Spain’s bonds to junk status. But Moody’s surprised the markets and did not downgrade Spain. This in turn, led to a very strong Spanish bond auction where Spain sold more bonds than they planned and at a much lower rate than expected. This caused foreign investors that had been parking their money in nice and safe MBS, to pull their funds out of U.S. bonds and to put that cash back to work in Europe.

What to Watch Out For This Week:

The following are the major economic reports that will hit the market this week. They each have the ability to affect the pricing of Mortgage Backed Securities and therefore, interest rates for Government and Conventional mortgages.

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I will be watching these reports closely for you and let you know if there are any big surprises.

It is virtually impossible for you to keep track of what is going on with the economy and other events that can impact the housing and mortgage markets. Just leave it to me, I monitor the live trading of Mortgage Backed Securities which are the only thing government and conventional mortgage rates are based upon.

mortgage broker denverVince Reece
Senior Loan Officer
Office: 303-840-0966
Cell: 303-818-0699
vince@coloradomortgageguy.com
19519 E Parker Square Dr
Parker, CO 80134
www.coloradomortgageguy.com

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