Houston Real Estate & Mortgage Update The Woodlands

Yesterday interest rate markets improved, the 10 fell 4 bps to 2.70% and 30 yr MBS prices gained 35 bps in price. This morning no follow-through early; the rate markets remain range bound within an extremely narrow range, This morning the stock market is better, still the S&P has not been able to close in a new all-time high. From everything we are hearing and reading investors in stocks, even the most optimistic, are worrying that after the huge run up in 2013 the stock market may be momentarily running out of momentum. That view is likely why the interest rate markets have bucked the obvious and not increased. Although interest rates have held well for the last few weeks, there hasn’t been any significant change in rates; how much longer will the tight range remain is dependent on what happens in the equity markets. 

At 10:00 the economic data of the day; Jan new home sales, expected down 3.4% to 400K units (annually), were up 9.6% to 468K units, the strongest sales month since July 2008. Dec sales were revised higher, to -3.8% at 427K from 414K. It is a volatile series but that was a huge surprise. The reaction sent stock indexes back into positive readings but didn’t change the rate markets much. New home sales are not as significant as existing home sales because the data is a narrower sample. Earlier this morning the weekly MBA mortgage applications took another fall, last week down 4.1%, this week -8.5% for the overall index.

Regardless of the outlook for higher interest rates, the technical picture is still slightly bullish for the 10 and MBSs. The 10 holding under its 2, 40 and 100 day averages and the 14 day relative strength index below 50. We have to stay with the technicals, there isn’t a lot of buying but equally there is no significant selling. The reasons may be murky and debatable but the market is where talk ends and money takes center stage. 

Basically what I am saying is if you have not locked you rate you may want to hold off in the event we get an improvement in the next few days. Stay alert though because things can change in a instance. Follow this BLOG for all your Austin, Houston, San Antonio and Dallas Real Estate and Mortgage news.