MMG Weekly 3/26/18

Guy R. Vetrano NMLS# 183357
Senior Loan Officer
Bay Equity Home Loans
Phone: 480.500.6000 x 6017
Mobile: 602-692-7196


In This Issue  
Last Week in Review: Retail Sales and Housing Starts blossom in March.

Forecast for the Week: Housing reports and GDP highlight a full economic calendar.

View: Find out how to recover lost text from shared documents and files on three popular platforms.

Last Week in Review  
“Hey, big spender.” Shirley Bassey. After three straight months of declines, Retail Sales rebounded in March as consumers spent their hard-earned dollars.

Retail Sales rose 0.6 percent in March, above the 0.4 percent expected and up from the decline of 0.1 percent in February, the Commerce Department reported. Leading the boost was spending on automobiles and health and personal care items. Consumer spending makes up two-thirds of U.S. economic activity and is crucial to a healthy economy.

Housing Starts also bloomed in March, rising 1.9 percent from February to an annual rate of 1.319 million units, per the Commerce Department. February’s figure was also revised higher to 1.295 million units. Housing Starts got a big boost from a 16.1 percent monthly increase from the multi-dwelling sector. However, things were less rosy for those interested in single family homes, as single-family starts fell 3.7 percent from February. From March 2017 to March 2018, Housing Starts were up 10.9 percent.

Building Permits, a sign of future construction, rose 2.5 percent from February to March to an annual rate of 1.354 million. Limited inventory remains a challenge in many areas of the country, so it will be important to see if Housing Starts continue to blossom and if single family starts shift gears higher.

Mortgage Bonds struggled in the latest week, approaching five-year lows, due to strong economic news and positive data. Home loan rates have edged higher but still remain historically attractive.

If you or someone you know has any questions about rates or home loans, please get in touch. I’d be happy to help.

Forecast for the Week  
The busy economic calendar contains key releases on home sales and first quarter GDP.

  • Housing data kicks off the week with Existing Home Sales on Monday. The S&P/Case-Shiller Home Price Index and New Home Sales follow on Tuesday.
  • Look for Consumer Confidence on Tuesday and the Consumer Sentiment Index on Friday.
  • On Thursday, weekly Initial Jobless Claims and Durable Goods Orders will be reported.
  • On Friday, Gross Domestic Product, the Employment Cost Index and the Chicago PMI will be released.

Remember: Weak economic news normally causes money to flow out of Stocks and into Bonds, helping Bonds and home loan rates improve. In contrast, strong economic news normally has the opposite result. The chart below shows Mortgage Backed Securities (MBS), which are the type of Bond on which home loan rates are based.

When you see these Bond prices moving higher, it means home loan rates are improving. When Bond prices are moving lower, home loan rates are getting worse.

To go one step further, a red “candle” means that MBS worsened during the day, while a green “candle” means MBS improved during the day. Depending on how dramatic the changes are on any given day, this can cause rate changes throughout the day, as well as on the rate sheets we start with each morning.

As you can see in the chart below, Mortgage Bonds have edged lower. Home loan rates remain near historic lows.

Chart: Fannie Mae 4.0% Mortgage Bond (Friday Apr 20, 2018)

The Mortgage Market Guide View…  

Tech Tip: 3 Must-Have Mobile Scanner Apps

From receipts and business cards to notes, documents and to-do lists, it’s easy to get into a paper pile-up. Don’t risk misplacing or losing that information for good. You can convert all these items and more into permanent digital files with one of these smartphone scanner apps.

Genius Scan helps you easily digitize all sorts of documents for free. The perspective correction feature fixes distortion, so you don’t have to snap a perfect picture to capture your data. Additionally, you can convert all your scans into PDF files, export and share them through Dropbox, Evernote and other popular cloud-storage services. Genius Scan+ ($7.99*) offers an ad-free experience with additional export options, PDF encryption and more. Available on Android and iOS.*

Scanbot offers the ability to scan all sorts of media into PDF or JPEG files. The app supports major clouds services and allows you to automatically export based on your preferences. iOS users also have the ability to fax documents right through the app to more than 50 supported countries. Available on Android and iOS.*

Google Drive allows Android users to take a picture of receipts, letters, statements and other documents and convert them into a PDF file. While the scan feature is not yet available to iOS users, other features of Google Drive are still accessible. Free for Android, iOS and desktop.*

These apps can help make your smartphone even smarter and you even more productive.

*Prices and availability current at the time of writing.

Economic Calendar for the Week of March 19 – March 23
Economic Report
Wed. March 21
Existing Home Sales
Wed. March 21
FOMC Meeting
Thu. March 22
Jobless Claims (Initial)
Fri. March 23
Durable Goods Orders
Fri. March 23
New Home Sales
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As your mortgage professional, I am sending you the MMG WEEKLY because I am committed to keeping you updated on the economic events that impact interest rates and how they may affect you.
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