FXEMPIRE
All
Ad
Corona Virus
Stay Safe, FollowGuidance
World
63,197,791Confirmed
1,467,485Deaths
43,694,028Recovered
Fetching Location Data…
Advertisement
Advertisement
Bob Mason
Mortgage application loan agreement and house key

Mortgage rates avoided a fall to yet another all-time low in the week ending 29th October. Following a 1 basis point fall in the week prior, the 30-year fixed rate rose by 1 basis point to 2.81%.

Compared to this time last year, 30-year fixed rates were down by 97 basis points.

Advertisement

30-year fixed rates were also down by 213 basis points since November 2018’s most recent peak of 4.94%.

Economic Data from the Week

Economic data was on the lighter side in the 1st half of the week.

Key stats included durable goods and core durable goods orders for September and October consumer confidence figures.

It was a mixed bag on the data front.

While both durable goods and core durable goods orders rose in September, consumer confidence softened in October.

The stats had a muted impact on the broader market, however, with a surge in new COVID-19 cases weighing on risk appetite.

With a number of EU member states reintroducing lockdown measures, the fear is that the U.S may have to follow.

On the geopolitical risk front, market jitters ahead of the U.S Presidential Election next week also weighed on riskier assets.

Advertisement

Freddie Mac Rates

The weekly average rates for new mortgages as of 29th October were quoted by Freddie Mac to be:

  • 30-year fixed rates increased by 1 basis points to 2.81% in the week. Rates were down from 3.75% from a year ago. The average fee rose from 0.6 points to 0.7 points.
  • 15-year fixed rates fell by 1 basis points to 2.32% in the week. Rates were down from 3.19% compared with a year ago. The average fee held steady at 0.6 points.
  • 5-year fixed rates increased by 1 basis points to 2.88% in the week. Rates were down by 55 points from last year’s 3.43%. The average fee remained unchanged at 0.3 points.

According to Freddie Mac,

  • The record-low mortgage rate environment is providing tangible support to the economy at a critical time.
  • Strong purchase demand is helping to lift the construction, manufacturing, and transportation industries.
  • Homeowners, looking to sell or make home improvements, are also supporting consumption
  • On the refinance front, many consumers are smartly taking advantage of the ability to lower their monthly payments. This means that homeowners can spend, save, or pay down debt more so than in the past.

Mortgage Bankers’ Association Rates

For the week ending 23rd October, rates were quoted to be:

  • Average interest rates for 30-year fixed, backed by the FHA, increased from 3.12% to 3.14%. Points remained unchanged 0.35 (incl. origination fee) for 80% LTV loans.
  • Average interest rates for 30-year fixed with conforming loan balances decreased from 3.02% to 3.00%. Points fell from 0.36 to 0.35 (incl. origination fee) for 80% LTV loans.
  • Average 30-year rates for jumbo loan balances decreased from 3.33% to 3.28%. Points increased from 0.30 to 0.31 (incl. origination fee) for 80% LTV loans.

Weekly figures released by the Mortgage Bankers Association showed that the Market Composite Index, which is a measure of mortgage loan application volume, increased by 1.7% in the week ending 23rd October. In the week prior, the index had slipped by 0.6%.

The Refinance Index increased by 3% and was 80% higher than the same week a year ago. In the week prior, the index had risen by 0.2%.

The refinance share of mortgage activity increased from 66.1% to 66.7%. In the previous week, the share had risen from 65.6% to 66.1%.

According to the MBA,

  • While mortgage rates were flat compared to the week prior, overall activity remains strong this fall.
  • Applications jumped 24% compared to last year, with the average loan size reaching a record-high of $372,600.
  • Housing inventory shortages have pushed national house prices considerably higher on an annual basis.
  • Refinance activity has been on the more volatile side in the past few months.

For the week ahead

It’s a busier 1st half of the week on the U.S economic calendar.

Key stats include the market’s preferred ISM Manufacturing and Non-Manufacturing PMIs and ADP nonfarm employment change figures.

Factory orders are also in focus but will likely be overshadowed by the private sector PMIs and labor market numbers.

The main event, in the 1st half of the week, is the U.S Presidential Election, however.

Expect plenty of market volatility that will influence U.S Treasury yields and ultimately mortgage rates.

With the election the key driver, COVID-19 updates will also provide direction. Any suggestions of a reintroduction of lockdown measures across badly affected U.S states would further test risk appetite.

Don't miss a thing!
Discover what's moving the markets. Sign up for a daily update delivered to your inbox

Trade With A Regulated Broker

  • Your capital is at risk
IMPORTANT DISCLAIMERS
The content provided on the website includes general news and publications, our personal analysis and opinions, and contents provided by third parties, which are intended for educational and research purposes only. It does not constitute, and should not be read as, any recommendation or advice to take any action whatsoever, including to make any investment or buy any product. When making any financial decision, you should perform your own due diligence checks, apply your own discretion and consult your competent advisors. The content of the website is not personally directed to you, and we does not take into account your financial situation or needs.The information contained in this website is not necessarily provided in real-time nor is it necessarily accurate. Prices provided herein may be provided by market makers and not by exchanges.Any trading or other financial decision you make shall be at your full responsibility, and you must not rely on any information provided through the website. FX Empire does not provide any warranty regarding any of the information contained in the website, and shall bear no responsibility for any trading losses you might incur as a result of using any information contained in the website.The website may include advertisements and other promotional contents, and FX Empire may receive compensation from third parties in connection with the content. FX Empire does not endorse any third party or recommends using any third party's services, and does not assume responsibility for your use of any such third party's website or services.FX Empire and its employees, officers, subsidiaries and associates, are not liable nor shall they be held liable for any loss or damage resulting from your use of the website or reliance on the information provided on this website.
RISK DISCLAIMER
This website includes information about cryptocurrencies, contracts for difference (CFDs) and other financial instruments, and about brokers, exchanges and other entities trading in such instruments. Both cryptocurrencies and CFDs are complex instruments and come with a high risk of losing money. You should carefully consider whether you understand how these instruments work and whether you can afford to take the high risk of losing your money.FX Empire encourages you to perform your own research before making any investment decision, and to avoid investing in any financial instrument which you do not fully understand how it works and what are the risks involved.
FOLLOW US