Mortgage and Real Estate Blog Update

Riding into the sunset, the BLS Dec employment report. As noted yesterday, just let it go. Markets were temporarily shaken with the Dec data, and the rate markets were finding strong technical resistance at 3.00% on the 10. The confluence of the two things provided a swift rally, now rates are returning to levels prior to the employment data. The positive news is that the 10 yr is still under 3.00% and MBS rates are slightly better than a week ago. Bullard is not a voter on the FOMC.

Mortgage applications increased 11.9% from one week earlier, according to data from the Mortgage Bankers Association’s (MBA) Weekly Mortgage Applications Survey for the week ending January 10, 2014. The Refinance Index increased 11% from the previous week. The seasonally adjusted Purchase Index increased 12% from one week earlier, but is at a level similar to what was observed in mid-November 2013. The unadjusted Purchase Index increased 66 percent compared with the previous week and was 10 percent lower than the same week one year ago.

Another Fed speaker up at 12:50 pm; Charles Evans, Chicago Pres. So far this week every Fed regional President has stood firm on the Fed’s plan to cut monthly purchases this year. Not one has wobbled in the face of the Dec employment data. Not likely Mr. Evans will cast the first stone.

At 2:00 the Fed’s Beige Book will be released. Always interesting with details from each of the 12 districts.

The bond market is still bearish; the consensus is two-fold, the Fed will continue withdrawing support for long term rates (MBSs and treasuries) and the economy will continue to gain momentum. Technicals are leaning to higher rates but since early Dec to 10 yr note has been unable to move above 3.00% or below 2.80%, 20 basis points. Over time the 10 will move above 3.00% and mortgage rates will increase; in the meantime and through the reminder of January the range should contain all movements.

This is a good opportunity and maybe your last to lock in a low mortgage interest rate. You will want to follow my BLOG for daily updates in the mortgage and real estate industries for Texas and all surrounding major metropolitan areas like Houston, The woodlands, Spring, Conroe, San Antonio, Dallas & Austin.