Charleston SC Real Estate Blog

New home sales unexpectedly rose 3.3% in April, the first increase in six months, the Commerce Department said May 27. As a result, the inventory of unsold new homes fell slightly to a 10.6 months’ supply versus the 11.1 months’ backlog recorded in March.
The Commerce Department further reported that the median price of a new home sold in April rose to $246,100, up 1.5% from April 2007. In a separate report, however, the Standard & Poor’s/Case-Shiller Index showed existing home prices falling 14.1% in the first quarter of 2008, compared with a year earlier, the biggest year-over-year decline since the index began in 1988.
For the week ending May 29, interest rates on 30-year fixed-rate mortgages rose to an 11-week high, Freddie Mac said.
More mixed economic news came from the industrial sector. Orders to U.S. factories for durable goods — those expected to last three or more years — dropped 0.5%, dragged down by big declines in demand for commercial aircraft and autos. However, excluding transportation, orders rose 2.5% in April, the biggest gain in nine months. Orders for electrical equipment and appliances surged 27.8%, the biggest increase on record.
Another boost for the economy came on May 29 when the Commerce Department upwardly revised first-quarter gross domestic product or GDP — the total tally of the nation’s goods and services — from its previous estimate of 0.6% to an annual rate of 0.9%.
Finally, despite the government’s sending out billions of dollars in stimulus checks, consumer spending nudged up a small 0.2% in April, half of March’s increase, the Commerce Department said May 30. Personal income also edged up 0.2% in April, again half of March’s 0.4% increase.
This week, watch for the May unemployment report due out on June 6.
Economic data compiled from government reports and news services Bloomberg.com, msnbc.com, cnbc.com, cnn.money.com and Yahoo Economic Calendar.

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 Hello All, I have enclosed a forecast for the remainder of this week. Rates continue to rise slowly, and then fall back down. If you ever need any help working on estimated payments for your clients you can go to www.VirtualMortgage.biz to get any information you would need. 
 
Forecast for the Week

After last week’s thin economic calendar, where Stock market action and technical factors had a big impact on Bonds and home loan rates, this coming week brings a much juicier economic report agenda.
Retail Sales for April will be reported on Tuesday, followed by Wednesday’s Consumer Price Index (CPI). This widely watched measure of consumer inflation will take special significance, now that the Fed has signaled their current rate cutting cycle may be at an end. On Thursday comes a read on the new construction housing market, with Housing Starts and Building Permits. We will have to see if these reports can keep Bonds above their 50- and 100-Day Moving Averages…as seen in the chart below. If the reports are economically weak or negative, Bond prices and home loan rates should hold their ground, and perhaps even find some improvement.
Remember when Bond prices move higher, home loan rates move lower…and vice versa. And right now, there’s an important story breaking that will be very important to stay tuned in to. Last Friday, oil prices reached a lofty $126 a barrel, and Goldman Sachs is forecasting that black gold could rise even higher, perhaps as high as $150 - $200 a barrel in the next twelve months. If they are right, the inflationary effects of high oil prices could pressure Bond prices to move lower, causing home loan rates to move higher. This will be a story to watch carefully in the days and months ahead.

    Rates today are as follows:
 
   30 year fixed/Conforming: 5.75%
   30 year fixed/Jumbo: 7.25%
   7 year arm/Conforming: 5%
   7 year arm/Jumbo: 6.625%
 
Thanks,
Matthew Mieras, xco
Virtual Mortgage
843-849-8188 Office
843-670-5512 Cell
Matt@VirtualMortgage.biz  

Consumer confidence fell to a 25-year low, according to the Reuters/University of Michigan consumer sentiment index, dropping from 69.5 in March to 62.6 in April. The reading is troubling because it’s regarded as an indicator of future consumer spending, which accounts for about 70% of U.S. economic activity.
Sales of existing homes dropped 2% in March to an annual rate of 4.93 million units, the National Association of REALTORS® reported April 22. The median price of an existing home tumbled 7.7% from a year ago to $200,700, the second biggest decline since a record 8.4% drop in February.
Sales of new homes plunged 8.5% in March to an annual rate of 526,000 units, the slowest sales pace since October 1991, the Commerce Department said April 24. The median price of a new home dropped 13.3% from a year ago to $227,600, the biggest year-over-year price decline since a 14.6% plunge 38 years ago. At the current sales pace, it would take 11 months to deplete the national inventory of new homes.
Homebuyers didn’t get much mortgage rate relief as 30-year and 15-year fixed-rate loans edged up for the week ending April 24, Freddie Mac said in its weekly survey of mortgage lenders.
The demand for durable goods — big-ticket items expected to last three or more years — dipped 0.3% in March, a worse-than-expected showing, the Commerce Department said April 24. The last time orders fell for three consecutive months was from February to April of 2001, when the nation was sliding into the last recession.
The job front was a bit rosier, however, as new claims for unemployment benefits fell by 33,000 last week to 342,000, the Labor Department reported April 24. Economists had expected a rise of 3,000.
Economic news due this week includes another consumer confidence report on April 29 and a preliminary report on the nation’s first-quarter gross domestic product on April 30.
Economic data compiled from government reports and news services Bloomberg.com, msnbc.com, cnbc.com, cnn.money.com and Yahoo Economic Calendar.