Mortgage markets were mostly unchanged last week, breaking a three-week winning streak. Wall Street grappled with surprising demand on Spain’s debt issuance and a series of weaker-than-expected data points on U.S. housing.
Conforming mortgage rates across Michigan rose slightly according to the weekly Freddie Mac Primary Mortgage Market Survey.
Nationwide, the 30-year fixed rate mortgage rate climbed 2 basis points to 3.90%. This rate is available to homeowners willing to pay 0.8 discount points and a full set of closing costs, where 1 discount point is equal to 1 percent of the borrowed amount.
Prior to last week’s survey, just 0.7 discount points were required.
This week, mortgage rates are expected to be volatile. There is a lot of economic data due for release, the Eurozone’s issues with sovereign debt remain unresolved, and the Federal Open Market Committee gets together for a scheduled, 2-day meeting.
On the data front, the week starts with Tuesday’s Consumer Confidence figures and the government’s New Home Sales report. Both have the power to move mortgage rates. The week then concludes with the Pending Home Sales Index; the GDP release; and a series of Treasury auctions.
With respect to Europe, demand remains strong for debt from Spain, but at much higher rates as compared to several weeks ago. The same is true for Italy. Both nations are feared to be at risk of default on their respective sovereign debt. It’s a similar situation to that which occurred in Greece throughout 2011.
Long-term, lingering concerns for Spain and Italy would likely help keep U.S. mortgage rates suppressed.
And, lastly, the Federal Reserve will make a statement to markets Wednesday afternoon. The Fed is the nation’s central banker and its post-meeting press releases have tremendous influence on bond markets, including those for mortgage-backed bonds.
By extension, therefore, the Federal Reserve’s statement has the power to move mortgage rates in and around Rochester Hills.
If you’re shopping for mortgage rates, it’s as good of a time as any to lock with your lender. Rates have more room to rise than to fall.